IMAGE  EVALUATION 
TEST  TARGET  (MT-3) 


1.0     ;^U£  I2£ 

Hi  lU  121 


I.I 


u 


2.0 
pi.8 


Fhotogmphic 

Sdenoes 

Corporation 


4^ 


'^ 


v 


<^ 


^. 


4^/V 


33  WIST  MAIN  STtHT 

WIBSTni,N.Y.  14SM 

(716)t7a-4S03 


v\ 


w^m^^w 


CIHM/ICMH 

Microfiche 

Series. 


CIHM/iCIVIH 
Collection  de 
microfiches. 


Canadian  Instituta  for  Historical  Microraproductlont  /  Inttitut  Canadian  da  microraproductions  historiquaa 


©1984 


Tachnical  «.^td  Bibliographic  NotM/Not«s  tachniquM  at  bibllographiquM 


Th«  Inttltuta  haa  attamptad  to  obtain  tha  boat 
original  oopy  avaliabia  for  filming.  Faaturaa  of  thia 
eopv  whioh  may  ba  bibHographicaNy  uitiqua. 
wMeh  may  altar  any  of  tha  imagaa  in  tha 
raproduetlon,  or  wMch  may  aignlfleantly  ohanga 
tht  uaual  rnathod  of  filming,  ara  chackad  balow. 


□  Celourad  covara/ 
Couvartura  da  coulaur 

rn   Covara  damagad/ 


D 
D 


D 


Couvartura  andommagia 

Covara  raatorad  and/or  iaminatad/ 
Couvartura  raataur^a  at/ou  pailiculAa 

Covar  titia  miaaing/ 

La  tttra  da  couvartura  manqua 

Colourad  mapa/ 

Cartaa  gAographiquas  1%  coulaur 

Colourad  ink  (i.a.  othar  than  blua  or  black)/ 
Encra  da  coulaur  (i.a.  autra  qua  blaua  ou  noira) 


r~'\  Colourad  plataa  and/or  illuatrationa/ 


D 


Planehaa  at/ou  illuatrationa  an  coulaur 


Bound  with  othar  matariai/ 
RalM  avac  d'autraa  documents 


Tight  binding  may  cauaa  shadows  or  distortion 
along  intarior  margin/ 

L»  fa  liura  sarrAa  paut  cauaar  da  I'ombra  ou  da  la 
distortion  la  long  da  la  marga  intAriaura 

Blank  iaavaa  addad  during  rastoration  may 
•ppaar  within  tha  taxt.  Whanavar  possibia,  thasa 
hava  baan  omittad  from  film'ng/ 
II  sa  paut  qua  cartainas  pagas  blanches  ajoutias 
lors  d'una  rtatauration  apparaissant  dana  la  taxta, 
moia,  loraqua  cala  Atait  possibia.  cas  pagaa  n'ont 
pas  At*  filmtes. 

Additional  comments:/ 
Commantairas  suppitmantairas: 


L'Inatitut  a  microfllmi  la  maiilaur  axamplaira 
qu'il  lul  a  At*  poaaibia  da  aa  procurer.  Las  d*taiis 
da  cat  axemplaira  qui  aont  peut-*tre  unlquee  du 
point  do  vue  bibliographiqua,  qui  peuvent  modifier 
une  image  reprouuite.  ou  qui  peuvent  exiger  une 
modification  dana  la  niAthoda  normale  de  fiimage 
aont  indiqu*s  ci-daaaoua. 


D 

D 

n 

D 

0 

D 
D 
D 
D 


Coloured  pajjes/ 
Pagaa  da  coulaur 

Pages  damaged/ 
Pagaa  endommag*es 

Peges  restored  and/or  laminated/ 
Peges  restaur*es  et/ou  peiiicul*es 

Pages  discoloured,  stained  or  foxed/ 
Pages  d*coior*es.  tachet*es  ou  piqu*es 

Pages  detached/ 
Pages  d*tach*es 

Showthrough/ 
Tranaparence 

Quality  of  print  variaa/ 
Qualit*  in*gale  de  I'impression 

Includes  supplementary  material/ 
Comprend  du  met*riel  suppi*menteire 

Only  edition  available/ 
Seule  *dition  disponible 

Pages  wholly  or  partially  obscured  by  errata 
slips,  tissuea.  etc..  have  been  refilmed  to 
ensure  the  best  possible  image/ 
Les  peges  totalement  ou  partieilement 
obscurcies  par  un  feuiilet  d'errata.  une  pelure, 
etc.,  ont  *t*  fiim*es  *  nouveau  de  fa^on  * 
obtenir  la  meilleure  imege  possible. 


TMa  Itam  is  filmed  at  the  reduction  ratio  checked  below/ 

Ca  document  eat  film*  au  teux  de  r*duction  indiqu*  ci-deaaoua. 


IPX 

14X 

18X 

22X 

26X 

30X 

y 

• 

12X 

16X 

aox 

24X 

28X 

32X 

TIm  copy  film«d  hart  hM  lM«n  raproduead  thanks 
to  tha  ganaroshy  of: 

Library  of  tha  Public 
Archives  of  Canada 


L'axamplaira  fllm4  fut  raproduit  grioa  A  la 
g4n4rosM  da: 

La  bibliothAqua  das  Archives 
publiquas  du  Canada 


Tha  imagas  appearing  hara  ara  tha  bast  quality 
posslbia  consMaring  tha  condition  and  legibility 
of  tha  orlginel  copy  and  In  keeping  with  the 
filming  contract  specifications. 


Original  copies  In  printed  paper  covers  ara  fllnMd 
beginning  with  the  front  ccver  and  ending  on 
the  last  page  with  a  printed  or  llluatratad  Impree- 
sion,  or  the  back  cover  when  appropriate.  All 
other  original  copies  are  filmed  beginning  on  the 
first  page  with  a  printed  or  illustrated  Impres- 
sion, and  ending  on  the  laat  page  wMi  a  printed 
or  illustrated  impresston. 


Les  images  suh/antea  ont  4tA  raproduitee  avac  la 
plua  grand  soin,  compta  tanu  do  la  condition  at 
da  la  nattet4  de  rexemplaire  fiimA.  et  en 
conf ormM  avac  les  conditions  du  contrat  de 
filmage. 

Lee  exempkiiree  origineux  dont  le  couverture  en 
papier  est  imprimis  sent  filmis  sn  commen^nt 
per  le  premier  pkit  et  en  terminant  salt  par  la 
damMre  page  qui  comporte  une  empreinte 
d'Impreesion  ou  dlllustratlon,  sdt  par  le  sscond 
plat,  aalon  le  cas.  Tous  las  autras  exemplairas 
origineux  sent  f  limis  en  commenpant  par  la 
pramlAre  page  qui  comporte  une  empreinte 
d'impression  ou  d'lllustration  et  en  terminant  par 
la  damMre  pege  qui  comporte  une  telle 
empreinte. 


The  last  recorded  frame  on  each  microfiche 
shall  contain  the  symbol  — ^»  (meaning  "CON- 
TINUED"), or  the  symbol  ▼  (meaning  "END"), 
whichever  applies. 


Un  dee  symbdes  suhrer..   apparattra  sur  la 
dernlAre  imege  de  cheque  microfiche,  scton  le 
cas:  la  symbole  — »*  signifle  "A  8UIVRE",  le 
symbole  ▼  signifle  "FIN". 


Maps,  plates,  charts,  etc.,  mey  Im  filmed  Bt 
different  reduction  retios.  Those  too  large  to  be 
entirely  included  in  one  exposure  are  films  d 
beginning  in  the  upper  hit  hand  corner,  left  to 
right  and  top  to  bottom,  as  many  frames  as 
required.  The  following  diagrams  illustrate  the 
method: 


Les  cartes,  planches,  tabieaux,  etc.,  peuvent  Atre 
filmAs  A  des  taux  de  rAduction  diff Arents. 
Lorsque  to  document  est  trop  grand  pour  Atre 
Mprodult  en  un  seul  ciichA,  11  est  filmA  A  pertir 
de  I'engto  supArieur  gauche,  de  geuche  A  droite, 
et  de  haut  en  has,  an  prenant  to  nombre 
d'imeges  nAcesselre.  Les  diagrammes  suivsnts 
illustrent  to  mAthode. 


1 

2 

3 

1 

2 

3 

4 

5 

6 

riNANCIAL  CRISES: 


THEIR 


CAUSES   AND    EFFECTS. 


BY 


IlilNKY   C.   CAREY. 


'■«■■«»- 


W' 


PHILADELPHIA  ; 
HENRY    CAREY    BAIRD, 

INDUSTRIAL    PUBLISHER, 
No.    40  6    WALNUT    STREET. 
1864.    ^. 


FINANCIAL  CRISES:  THEIR  CAUSES  AND  EFFECTS. 


LETTER    FIRST. 


T>FATl  S|[»,.  — Til  your  recent  and  highly  interesting  volume,  which 
1  havt)  jijHt  iiitw  rend,  tlmro  is  ii  [)a8sage  to  which,  on  account  of  it.s  great 
iiuportiuico  rw  m^iU'dM  the  jirogroj^s  ol'  man  towards  an  ultiniato  state  of 
perfect  friMidniu  ov  iil»Molute  slavery,  I  feel  disposed  to  invite  your  atten- 
tion. It  Ih  liH  fulloWM!  "  I  am  pained  to  hear  such  bad  news  from  the 
United  Hlti'eH  — hucIi  accounts  of  cinbarrassments  and  failures,  of  eud- 
den  poverty  liiHinw  on  the  opulent,  and  thousands  left  destitute  of  cm- 
ployuienl,  tmd  pci'liiipH  of  bread.  This  is  one  of  the  epidemic  visitations 
ugaiiiHt  which,  I  i'vnv,  no  human  prudence  can  provide,  so  far,  at  least, 
as  to  prevent  their  recurrence  at  longer  or  shorter  intervals,  any  more 
tlian  it  Clin  prevent  the  ncnrlet  fever  or  the  cholera.  A  money  market 
alwayH  in  perfect  health  und  soundness  would  imply  infallible  wisdom  in 
tlioso  wlio  (.'oiiduct  itH  operations.  I  hope  to  hear  news  of  a  better  state 
of  thingH  befui'o  1  write  again." 

Is  thi«*  really  m)'(  Can  it  be,  that  the  frequent  recurrence  of  such 
calamities  is  boyond  iho  reach  of  man's  prevention?  To  admit  that  so 
it  certainly  wiw,  would  be,  as  it  seems  to  me,  to  admit  that  Providence 
had  so  udjuHted  the  hiws  under  which  we  exist,  as  to  produce  those  "epi- 
demic vlsittttioiiH"  of  which  you  speak,  and  of  which  the  direct  effect, 
as  all  must  hoo,  in  tJiut  of  placing  those  who  need  to  sell  their  labor  at 
the  mercy  of  thoHO  who  have  food  and  clothing  with  which  to  purchase 
it  —  iiicreiiMJng  Mteadily  tlie  wealth,  strength,  and  power  of  these  latter, 
while  making  tho  former  poorer  and  more  enslaved.  Look  around  you, 
in  New  York,  at  tho  present  moment,  and  study  the  effects,  in  this  re- 
Bpeet,  of  tho  Htill-oiiduring  crisis  of  1857.  Turn  back  to  those  of  1822 
and  181!^,  and  Hou  how  strong  has  been  their  tendency  to  compel  the 
transfer  of  jirojarly  from  the  hands  of  persons  of  moderate  means  to 
those  of  men  who  were  already  rich  —  reducing  the  former,  with  their 
wives  and  ehlldr»tti,  in  tl.ousands,  if  not  even  hundreds  of  thousands  of 
cases,  to  tho  condition  of  mere  laborers,  while  largely  augmenting  the 
number  and  tho  fortunes  of  "merchant  princes"  who  have  no  need  to 
live  by  labor.  Look  around  yon  and  study  the  growth  in  the  number 
of  your  inlllioiiaircH,  side  by  side  with  a  pauperism  now  exceeding  in  its 
proportions  that  of  Ilritain,  or  even  that  of  Ireland.  Look  next  to  the 
condition  of  tho  men  who  labor  throughout  the  country,  deprived  as  they 
have  been,  and  ytft  are,  of  anytliing  approaching  to  steadiness  of  demand 
for  their  HorviooM,  in  default  of  Avhich  they  have  been,  for  two  years  past, 
unable  suitably  to  provide  for  their  wives,  their  children,  or  themselves. 
Study  then  tho  condition  uf  the  rich  mone^'-lenders  throughout  the  coun- 

(3) 


FINANCIAL  crises; 


try,  ctiiililod,  as  tlioy  havo  been,  to  domnnd  one,  two,  three,  and  even 
four  ami  five  per  cent  per  niontli,  from  tlie  miners,  nianiifaetnrers,  and 
little  f'iirniers  ot'  the  Union,  tintil  these  latter  have  been  entirely  eaten 
out  of  house  and  lionjc.  Having  done  all  this,  you  can  scarcely  fail  to 
arrive  at  the  conclusion,  that  unsteadiness  in  the  socictary  movement 
tends  towards  shivery  —  that  steadiness  therein,  on  the  contrary,  tends 
towards  the.  enianeipation  of  those  who  have  labor  to  sell  from  the  domi- 
nation of  those  who  require  to  buy  it — and  that,  therefore,  the  question 
referred  to  in  the  passage  I  have  quoted,  is  one  of  the  highest  interest  to 
all  of  those  who,  like  yourself,  are  placed  in  a  position  to  guide  their 
fellow-men  in  their  search  for  prosperity,  happiness,  and  freedom. 

The  larger  the  diversity  in  the  demand  for  human  powers,  the  more 
perfect  becomes  the  division  of  employments,  the  larger  is  the  produc- 
tion, the  greater  the  power  of  accumulation,  the  more  rapid  the  in- 
crease of  competition  for  the  purchixe  of  the  laborer's  services,  and  the 
greater  the  tendency  towards  the  establishment  of  human  freedom.  The 
greater  that  tendency,  the  more  ra])id  becomes  the  societary  action 
—  its  regularity  increasing  with  every  stage  of  progress.  In  proof  of 
this,  look  to  that  world  in  miniature,  your  own  printing-office,  studying 
its  movements,  as  compared  with  those  of  little  country  offices,  in  Avhich 
a  single  pcsrson  not  unfrequcntly  combines  in  himself  all  the  employments 
that  with  you  are  divided  among  a  hundred,  from  editor-in-chief  to  news- 
boy. The  less  the  division  of  employments,  the  slower  and  more  unsteady 
becomes  the  motion,  the  less  is  the  power  of  production  and  accumu- 
lation, the  greater  is  the  competition  for  the  sah  of  labor,  and  the  greater 
is  the  tendency  towards  the  enslavement  of  the  laborer,  be  he  black  or 
white. 

The  nearer  the  consumer  to  the  producer,  the  more  instant  and  the 
more  regular  become  the  exchanges  of  service,  whether  in  the  shape 
of  labor  for  money,  or  food  for  cloth.  The  more  distant  the  producer 
and  consumer,  the  slower  and  more  irregular  do  exchanges  become,  and 
the  greater  is  the  tendency  to  have  the  laborer  suffer  in  the  absence  of 
the  power  to  obtain  wages,  and  the  producer  of  wool  perish  of  cold  in 
the  absence  of  the  power  to  obtain  cloth.  That  this  is  so,  is  pro\cd  by 
an  examination  of  the  movements  of  the  various  nations  of  the  world, 
at  the  present  moment.  IJeing  so,  it  is  clear,  that  if  we  would  avoid 
those  crises  of  which  you  have  spoken — if  we  would  have  regularity  of 
the  socictary  movement — and  if  we  would  promote  the  growth  of  free- 
dom— we  must  adopt  the  measures  needed  for  bringing  together  the  pro- 
ducers and  consumers  of  food  and  wool,  and  thus  augmenting  their  power 
to  have  commerce  among  tL  :mselves. 

The  essential  characteristic  of  barbarism  is  found  in  instability  and 
irregularity  of  the  societary  action  —  evidence  of  growing  civilization 
being,  on  the  contrary,  found  in  a  constantly  augmenting  growth  of  that 
regularity  which  tends  to  produce  equality,  and  to  promote  the  growth 
of  freedom.  Turn,  if  you  please,  to  the  Wealth  of  Nations,  and  mark  the 
extraordinary  variations  in  the  prices  of  wheat  in  the  days  of  the  I'lan- 
tagenets,  from  kIx  shillings,  in  money  of  the  present  time,  in  1243,  to 
fiirttj-eUjht  in  124G,  srvcnti/-two  in  1257,  three  hundred  and  thirty-six  in 
1270,  and  twcntii-eljlit  in  12H6.  That  done,  see  how  trivial  have  been 
the  changes  of  Friuico  and  England,  from  the  close  of  the  war  in  1815, 


THEIR  CAUSES  AND  EFFECTS. 


to  tlic  present  tunc.  Next,  turn  to  llnssia,  and  mark  the  fact,  given  to 
us  by  u  recent  Uritish  traveller,  that,  in  those  parts  of  tlic  country  that 
have  no  manufactures,  the  farmer  is  everywhere  '*  the  victim  of  circum- 
stuncos"  over  which  lie  has  no  control  whatsoever — the  prices  of  liis  jiro- 
(lucts  heinj(  dopendcnt  entirely  upon  the  greater  or  smaller  size  of  tlio 
croj)8  of  other  land-s,  and  ho  being  ruined  at  the  very  moment  when  the 
return  to  his  labor  has  been  the  most  abundant.  Look  then  to  the  changes 
throughout  our  own  great  West  in  the  present  year — wheat  having  fallen 
from  iS1.30  in  May  to  50  cts.  in  July  —  and  you  w'll  sec  how  nearly  the 
htate  of  things  with  us  approximates  to  that  of  Russia.  Compare  all  this 
with  the  movements  of  England,  France,  and  Germany,  and  yiu  will, 
most  assuredly,  be  led  to  arrive  at  the  conclusion,  that  the  stability  whoso 
absence  you  deplore,  is  to  bo  sought  by  means  of  measures  looking  to  tho 
close  aitproximation  of  the  producer  und  the  consume/,  and  to  the  ex- 
tension of  domestic  commerce. 

Five  years  since,  IJritish  journals  nearly  all  united  in  predicting  tho 
advent  of  a  great  financial  crisis,  tho  seat  of  which  would  be  found  in 
France  and  (jiermany.  More  careful  observation  might  have  satisfied 
them  that  the  tendency  towards  such  crises  was  always  in  the  direct  ratia 
of  the  distance  of  consumers  from  producers,  ajid  that  the  real  places 
in  which  to  look  for  that  which  was  then  predicted,  were  those  coun- 
tries which  most  seemed  bent  on  separating  tiic  producers  and  consu- 
mers of  the  world,  Britain  and  America — the  one  seeking  to  drive  all  its 
people  into  the  workshops,  and  the  other  laboring  to  compel  them  all  to 
bcek  the  fields,  and  both  thus  acting  in  direct  defiance  of  the  advice  of 
Adam  Smith.  The  crisis  came,  spending  its  force  upon  those  two  coun- 
trk's — France,  Belgium,  and  Germany  escaping  almost  entirely  unharmed, 
und  for  the  reason,  that  in  all  these  latter  tlio  farm  and  the  work.-^hop 
were  coming  daily  more  near  together,  and  commerce  was  becoming  more 
ra])id,  free,  and  regular. 

llussia  and  Sweden  have,  however,  suiTered  much  —  the  crisis  having 
become,  apparently,  as  p'^rmanent  as  it  is  among  ourselves.  Why  should 
this  be  so  i*  Why  should  they  be  paralyzed,  while  France  and  Germany 
escape  uninjured  ?  Because,  while  these  latter  have  persisted  in  main- 
taining that  protection  which  is  needed  for  promoting  the  approximation 
of  producers  and  consumers,  the  former  have,  within  the  last  three  years, 
departed  essentially  from  the  system  under  which  they  had  been  so  rapidly 
advancing  towards  wealth  and  freedom  —  adopting  the  policy  advocated 
by  those  writers  who  sec  in  the  cheai)ening  of  the  lal)or  and  of  the  raw 
materials  of  other  countries,  the  real  British  road  to  wealth  and  power. 

Throughout  Northern  and  Central  Europe,  there  has  been,  in  the  last 
half  century,  a  rapid  increase  in  tho  steadiness  of  the  societary  move- 
ment, and  in  tho  freedom  of  man  —  that  increase  being  the  natural  con- 
sequence of  increased  rapidity  of  motion  resulting  fiom  a  growing  diver- 
sification in  the  demand  for  human  services,  and  growing  competition 
for  the  jjurt/tase  of  labor.  In  Ireland,  India,  Spanish  America,  and 
Turkey,  the  reverse  of  this  is  seen  —  producers  and  consumers  beco- 
ming more  widely  separated,  and  exchanges  becoming  more  fitful  and 
irregular,  with  growing  competition  for  the  :<(dc  of  labor.  Why  thi.s 
diflerence?  Because  the  policy  of  the  foimer  has  been  directed  towards 
protecting  the  farmer  in  his  efforts  to  draw  the  market  nearer  to  him, 


6  FINANCIAL  CRISES  : 

and  thus  (liiii'inish  tlic  wnstinij;  tiix  of  tniiisportiition,  wliilc  flio  latfor 
have  bc'on  steadily  hocoiiiin^  more  and  iiioro  Huhji'ctcd  to  tlic  system 
wliich  y-'vkn  to  locate  in  the  little  iilaiul  of  IJritaiii  the  single  woikship 
of  the  world. 

How  it  ha.s  boon  nniont?  oursolvc?,  is  shown  in  the  following  l)rief 
Rtateniont  of  the  facts  of  the  last  half  century.  From  the  date  of  tho 
passage  of  the  act  of  ISIO,  by  whidi  tho  axe  was  laid  to  tho  root  of  our 
then-rapidly-growing  nianufacturcs,  our  foreign  trade  steadily  declined, 
until,  ill  lS2l,  the  value  of  our  imptn'ts  was  loss  than  luilf  of  what  it 
had  been  ,six  years  before.  Thenceforward,  there  was  little  change  until 
the  higlily-i»rotocl'  act  of  1H2S  came  fairly  into  operation  —  the  ave- 
rage amount  of  ou.  importations,  from  1S22  to  18.*]0,  having  been  but 
80  millions — and  the  variations  having  been  between  t)G  millions  in  one 
year  and  70  in  niiother.  Under  that  tariff",  the  domestic  commerce  grew 
with  great  rapidity  —  enabling  our  people  promptly  to  sell  their  labor, 
and  to  become  better  customers  to  the  people  of  other  lands,  as  is  shown 
by  the  following  figures,  represeuting  tho  value  of  goods  imported : 

I8;;n-8i $103,000,000 

is.Ti-.'ia 101,000.000 

I8;?'j-;r, , 108,000,000 

1833-;i4 120,000,000 

ITero,  my  dear  sir,  is  a  nearly  regular  growth  —  the  last  of  these  years 
being  by  far  the  liighest,  aiul  exceeding,  by  more  than  50  per  cent, 
the  average  of  the  eight  years  from  18l!2  to  1880,  In  this  period,  not 
only  did  we  contract  no  foreign  debt,  but  we  paid  off"  the  whole  of  that 
which  previously  had  existed,  the  legacy  of  tho  war  of  independence; 
and  it  is  with  nations  us  with  individuals,  that  "  out  of  debt  is  out  of 
danger." 

The  compromise  tariif  began  now  to  exert  its  deleterious  influence 

—  stopping  the  building  of  mills  and  the  opening  of  mines,  and  thus 
lessening  the  power  to  nuiintain  domestic  commerce.  How  it  operated  on 
that  with  foreign  nations,  is  shown  in  the  facts,  that  tho  imports  of 
1887  went  up  to  8180,000,000,  and  those  of  1888  down  to  §118,000,000 

—  those  of  1839  up  to  3102,000,000,  and  those  of  1840  down  to 
$107,000,000;  while  those  of  18-12  were  kss  than  they  had  been  ten  years 
le/ore.  In  this  period,  we  ran  in  debt  to  foreigners  to  the  extent  of 
hundreds  of  millions,  and  closed  with  a  bankruptcy  so  universal,  as  to 
have  embraced  individuals,  banks,  towns,  cities,  ^States,  and  the  national 
treasury  itself 

That  instability  is  the  essential  characteristic  of  the  system  called  free- 
trade,  will  be  obvious  to  you  on  the  most  cursory  examination  of  the 
facts  presented  by  the  several  periods  of  that  system  through  which  we 
have  thus  far  passed.  From  more  than  §100,000,000,  in  1817,  our  im- 
ports fell,  in  1821,  to  $02,000,000,  In  1825,  they  rose  to  $96,000,000, 
and  then,  two  years  later,  they  were  but  $79,000,000.  From  1829  to 
1834,  they  grew  almost  regularly,  but  no  sooner  had  protection  been 
abandoned,  than  instability,  with  its  attendant  speculation,  reappeared 
— tho  imports  of  1836  having  been  greater,  by  45  per  cent,  than  those 
of  1834,  and  those  of  1840  little  more  than  half  as  great  as  those  of  1830, 

Once  again,  in  1842,  protection  was  restored ;  and  once  again  do  we 


I 


THEIR  CAUSES  AND   EFFECTS. 


hit  tor 

ikwliip 

hriof 

•r  tho 

of  our 

dined, 

vhut  it 

:o  until 

lie  nvo- 

H'U  liufc 

in  one 

)  ;:re\v 

labor, 

shown 


lied  frcc- 
in  of  the 
(vhich  we 
',  our  ini- 


find  a  steady  and  rojjular  f,'rowth  in  tlio  pov  r  to  niuintain  iiitcrcoiirHO 
with  tlu!  oiittT  world,  conscriuciil  upon  tho  yruwth  of  doiniistit;  euuaucrco, 
aa  is  .shown  in  the  following  ligurcs : 

iKt^-44 , $io«,ono,o<>o 

lH(l-4') n7,0(K/,0(M) 

lM.')-}ti llJl.d'IO.OOO 

18  jij-17 1  i';,(X)o,(juu 

We  have  hero  a  constant  increase  of  power  to  go  to  foroiifn  markets, 
aeconipaniod  by  a  constant  docroase  in  the  iimrssi/^  for  resorting'  to  tlicni 
—  the  domestic  prodiu-tioii  of  cotton  and  woollen  goids  havini;  doubled 
in  this  brief  period,  while  the  domestic  production  of  iron  had  more 
tlian  trebled.  ' 

Twelve  years  havini;  elapsed  since  the  tariff  of  1840  boeanie  fiilrly 
operative,  Ave  have  m)W  another  opportunity  for  contrasting  the  operation 
of  that  policy  under  which  I'ussia  and  Sweden  arc  now  sufferini;,  witli 
that  of  the  one  under  whieh  they  liad  made  such  rapid  proi^ress  —  that 
one  which  is  still  maintained  by  (jiermany  and  by  France.  Doinp;  this, 
we  find  the  same  instability  which  characterized  the  periods  whieh  pre- 
ceded the  passage  of  the  protective  tariff  acts  of  1^24, 18-8,  and  ISIIJ, 
and  on  a  larger  scale  —  the  imports  having  been  817S,00(i,(j(J0  in  1850, 
«;{04,()00,000  in  1851,  S'liW), {){)(), 000  in  1855,  8;500,000,000  in  1857, 
,S2S2,000,000  in  1858,  and  8;J38,U00,000  iu  1850  — and  our  foreign 
debt,  with  all  its  tendency  towards  producing  those  crises  which  you  so 
much  deplore,  having  been  uuguieutcd  probably  not  Ian  than  three  hun- 
dred miflluHH  of  dollars. 

Ten  years  since,  there  was  made  the  great  discovery  of  the  Califor- 
niau  gold  deposits — a  discovery  whose  effect,  we  were  then  assured,  was 
to  be  that  of  greatly  reducing  the  rate  of  interest  paid  by  those  who 
labored  to  those  others  who  wore  already  rich.  Have  such  results  been 
thus  far  realized  ?  Are  not,  on  the  contrary,  our  workingmen  —  our 
miners  and  manufacturers,  our  laborers  and  our  settlers  of  the  West  — 
now  paying  tlirlee  tho  price  for  the  use  of  money  that  was  paid  at  tho 
date  of  the  passage  of  the  tariff  act  of  1840  ?  Are  not  these  latter,  at 
this  moment,  paying  three,  four,  five,  and  even  as  high  as  six  per  cent 
p(!r  month?  Are  tliey  not  paying  mova i^c.r  month,  thau  is  imA  per  t/eur 
by  the  farmers  of  the  protected  countries  of  the  European  world  'i  That 
they  are  so,  is  beyond  a  doubt.  Why  it  is  so  is,  that  although  we  liavo 
received  from  California  five  huiulred  millions  of  gold,  we  have  been 
compelled  to  export,  in  payment  for  foreign  food  in  the  form  of  iron 
and  lead,  cloths  and  silks,  more  than  four  hundred  millions  —  leaving 
behind  little  more  than  has  been  required  for  consumption  in  tho  arts. 
Had  we  made  our  own  iron  and  our  own  cloth,  thus  making  a  domestic 
market  for  the  products  of  our  farms,  would  not  much  of  this  gold  have 
remained  at  home  ?  Had  it  so  remained,  would  not  our  little  farmers 
find  it  easier  to  obtain  the  aid  of  capital  at  the  rate  of  six  per  cent 
per  annum,  than  they  now  do  at  three,  four,  or  five  per  cent  per  month? 
Would  not  their  power  of  self  government  be  far  greater  than  it  is  now, 
under  a  system  that,  as  we  see,  makes  the  poor  poorer,  while  tho  very 
rich  grow  richer  every  day  ?  lleflect,  I  pray  you,  upon  these  questions 
aad  these  facts,  and  then  answer  to  yourself  if  the  crises  of  which  you 


r; 


FINANCIAL  crises: 


Fpoak  arc  not  tho  necessary  results  of  an  crronooutt  policy  of  which, 
durinj;  ho  long  a  period,  you  have  been  the  Htemly  udvoeuto, 

The  history  of  the  Union  for  tho  past  hulf  century  umy  now  lirlcfly 
thus  bo  stated :  Wc  have  liad  three  periods  of  protection,  chminu  in 
1M17,  1S34,  and  lH-17,  each  and  all  of  thcni  having  tho  (Mjuiitry  in  n 
state  of  the  highest  prosperity  —  competition  for  tho  purthdmi  of  labor 
then  growing  daily  and  rapidly,  with  constant  tendency  towardH  Incicuso 
in  the  amount  of  commerce,  in  tho  stiadinesa  of  tho  sociutury  uctlun, 
ond  in  the  freedom  of  the  men  who  needed  to  sell  thoir  labor. 

Wc  have  had  three  periods  of  that  systutn  which  lookH  to  tho  dustruo- 
tion  of  domestic  commere  ;,  and  is  called  /mt  tiiufr. — that  Hysteni  which 
prevails  in  Ireland  and  India,  Portugal  and  Turkey,  and  is  advocated  by 
IJritish  journalists  —  each  and  all  of  them  having  led  to  crlscH  HUch  um 
you  have  so  well  described,  to  wit,  in  1822,  1842,  and  1807.  In  each 
and  ov(  ry  case,  they  have  left  tho  country  in  a  state  of  paralysln,  Miniitar 
to  that  which  now  exists.  In  all  (»f  them,  tho  cxchangcH  liavo  bcconio 
more  and  more  langui<l,  the  socictary  movcmont  has  lusconio  nioro  und 
more  irregular,  and  the  men  who  have  needed  to  sell  their  labor  havo 
bcconio  more  and  more  mere  instruments  in  the  haudu  of  Ihusu  wliu  hud 
food  and  clothing  with  which  to  purchase  it. 

All  experience,  abroad  and  at  home,  tends,  thus,  to  prove  that  men 
become  more  free  as  the  domestic  commerce  beconuiB  nioro  rcg(dar, 
and  less  and  less  free  as  it  becomes  more  and  nioro  fltl'ul  and  disturbed. 
8uch  Ining  the  case,  tho  questions  as  to  tho  causes  of  crisus,  and  UH  to 
how  tlioy  may  bo  avoided,  assume  a  new  importance— .out)  greatly 
exceeding,  as  I  imagine,  that  which  you  felt  disposed  to  attach  to  tlioni 
when  writing  the  passage  which  has  above  been  given.  To  my  uppro- 
hensioii,  they  are  questions  of  liberty  and  slavery,  and  thercfuro  it  is 
that  T  feel  disposed  to  invite  you,  as  a  frifind  of  human  freedom,  to 
their  discussion  through  tho  columns  of  your  own  journal,  tho  J'Ji)riu'nf/ 
Post — that  discussion  to  be  carried  on  in  the  spirit  of  men  who  Mcek  for 
truth,  an  I  not  for  victory.  If  you  can  satisfy  mo  that  1  am  in  error  oh 
to  cither  facts  or  deductions,  I  will  at  once  admit  it;  und  you,  1  feel 
a^ssHrcd,  will  do  the  same.  As  an  inducement  to  such  discusMjoii,  I  now 
offer  to  have  all  your  articles  reprinted  in  protectionist  journulH|  to  tho 
extent  of  .300,000  copies  —  thereby  giving  vou  not  less  than  awHIlov. 
and  a  half  of  readers,  among  the  most  intelligent  people  of  thu  JInion. 
In  return,  I  ask  of  you  only,  that  you  will  publish  my  rcplicH  in  your 
single  journal,  with  its  circulation  of,  as  I  am  told,  fifteen  or  twenty 
thousand.     That  this  is  offering  great  odds,  you  must  admit. 

It  may,  however,  be  said,  that  the  replies  might  bo  such  ftM  Would 
occupy  too  large  a  portion  of  your  paper;  and  to  nic^et  that  diiruiulty,  I 
now  stipulate  that  they  shall  not  exceed  tho  length  ol'  tho  urlicles  to 
which  answers  arc  to  be  given  —  thus  leaving  you  entire  master  of  tho 
space  to  be  given  to  the  discussion.  Hoping  to  hear  that  you  usBCUt  to 
this  proposition,  I  remain,  very  respectfully. 

Your  obedient  servant, 

IIjcnhy  C.  Cauey. 

W.  C.  Bryant,  Esq. 

Philadblpmia,  Dtcmbtr'il,  18D9. 


THEIR  CAUSES  AND   KHkiCTri 


LETTER    SECOND. 

Pfar  Srn. — Allow  mo  now  to  nsk  you  why  it  is,  that  f^irnt  Hpeculii- 
tidiiH,  followed  by  cHhch  uikI  by  alinowt  total  pariilyHcs,  such  a.s  you  luive 
BO  well  do8cribt'»l,  alvni/s  occur  in  IVco  trade  tiiiuw,  and  «*/•</•  in  perioda 
when  tli(!  policy  of  the  country  is  being  directed  towards  the  creation 
of  domostie  niarkctH,  and  towards  the  relief  of  our  fanners  IVoni  the 
terrific  taxes  of  trade  and  transportation  to  which  they  are  now  sub;ectcd':' 
That  such  are  the  facts,  you  can  readily  satisfy  yoursell'  by  lookin;;  back 
to  the  fjjroat  speculations  of  the  four  periods  of  l!Sl7,  li^oO,  l^oU,  and 
inr)*;,  followed  by  the  crises  of  1H22,  1837, 1S42,  and  lS57  — and  then 
comparing  thorn  with  the  remarkable  st(!adiness  of  movement  which  eha- 
racterizod  those  of  the  protective  tariffs  of  182S  and  18-IU.  Study  our 
financial  history  as  you  nu>y,  you  will  find  in  its  every  page  new  evidence 
of  the  soundness  of  the  views  of  Washington,  Jefieri-oii,  and  Hamilton, 
Adams,  Madison,  and  Monroe,  each  and  all  of  whom  had  full  'jelief  in 
the  accuracy  of  the  ideas  so  well  enunciated  by  General  Jackson,  when 
ho  declared  that  we  "  had  been  too  lonf,'  subject  to  the  policy  of  IJritish 
merchants" — that  it  was  "  time  wo  should  become  a  little  more  Ann  ri- 
canizccl" — and  that,  if  wc  continued  l(m<,^er  the  policy  of  feeding  "  the 
paupers  and  laborers  of  England"  in  preference  to  our  own,  wo  should 
"  all  be  rendered  paupers  ourselves." 

Why  is  all  thisl'  Why  must  it  be  so?  Why  must,  and  that  incvi- 
tally,  speculation,  to  bo  followed  by  crises,  paralyses,  and  daily-growing 
pauperism,  be  the  invariable  attendant  upon  the  policy  which  looks  to 
the  separation  of  the  producer  of  raw  products  from  the  consumer  of 
the  finished  commodities  into  which  nxde  materials  are  converted?  T(j 
obtain  an  answer  to  all  these  questions,  let  us  look  again,  for  a  moment, 
to  the  proceedings  connected  with  tho  printing  and  publication  of  the 
Evcniuij  I'oftt.  Dealing  directly  with  your  paper-maker,  you  pay  him  cash, 
or  give  him  notes,  in  exchange  for  which  he  readily  obtains  tho  money 
—  no  artificial  credit  having  been  created.  Place  yourself  now,  if  you 
please,  at  a  disUmco  '^f  several  thousand  miles  from  tho  manufacturer, 
and  count  tho  many  hands  through  which  your  paper  would  have  to 
pass  —  each  and  every  change  giving  occasion  to  the  creation  of  notes 
and  bills,  and  to  the  charge  of  commissions  and  storage  j  and  you  will,  as 
1  think,  be  disposed  to  arrive  with  me  at  the  conclusion,  that  the  tendency 
towards  tho  creation  of  artificial  credits,  and  towards  speculation,  grows 
with  the  growth  of  tho  power  of  the  middleman  to  tax  the  producers 
and  consumers  of  the  world. 

Seeking  further  evidence  of  this,  let  me  ask  you  to  look  at  the  cir- 
cumstances which  attend  tho  sale  of  your  products.  Now,  your  custo- 
mers being  close  at  hand,  you  are  paid  in  cash — ^your  whole  year's  busi- 
ness not  giving,  as  I  suppose,  occasion  for  the  creation  of  a  single  note. 
Change  your  position,  putting  yourself  in  that  of  the  3Ianchester  manu- 
facturers, at  a  distance  of  thousands  of  miles  from  your  customers,  com- 
pelled to  deal  with  traders  and  transporters,  and  study  the  (quantity  of 


f  I 


10 


FINANCIAL  crises; 


f 


<  ; 


li 


it 

(: 


1 1- ; 
li, 


notes  and  bills,  with  their  attendant  charges,  that  would  be  created — the 
augmentation  of  price  and  diminution  of  consumption  that  would  be  the 
consequence — the  power  that  would  be  accumulated  in  the  hands  of  those 
who  had  money  to  invest,  and  desired  to  produce  such  crises  as  those 
which  you  have  so  well  depicted — and  you  will,  most  assuredly,  arrive  at 
the  conclusion  that  there  is  but  one  road  towards  steadiness  and  free- 
dom, and  that  that  road  is  to  be  found  in  the  direction  of  measures  having 
for  their  object  the  more  close  approximation  of  the  producers  svnd  con- 
sumers of  the  products  of  the  earth. 

Studying  next  the  great  facts  of  our  financial  history,  with  a  view  to 
ascertain  how  far  they  arc  in  accordance  with  the  theory  you  may  thus 
have  formed,  you  will  see  that,  in  thos^e  prosperous  years  of  the  tariff  of 
1828,  from  1880  to  1838,  the  quantity  of  bank  notes  in  circulation  was 
but  80  millions.  No  sooner,  however,  had  wc  entered  upon  the  free 
trade  policy,  providing  for  the  gradual  diminution  and  ultimate  aboli- 
tion of  protection,  than  we  find  a  rapid  growth  of  speculation,  conse- 
quent upon  the  growing  power  for  the  creation  of  artificial  credits — the 
average  circulation  of  the  years  from  1884  to  1887  having  been  no  less 
than  i49  millions,  or  nearly  twice  what  it  before  had  been.  Under 
the  protective  tariff  of  1842,  the  average  was  but  76  millions ;  but  no 
sooner  had  protection  been  abandoned,  than  we  find  an  increase  so  rapid 
as  to  have  carried  up  the  average  from  184G  to  1849,  to  118,  and  that  of 
1850  and  1851,  to  148  millions.  In  that  period  speculation  had  largely 
grown,  but  prosperity  had  as  much  declined.  "When  the  circulation  was 
small,  domestic  commerce  was  great  —  mines  having  been  opened,  fur- 
naces and  factories  having  been  built,  and  labor  having  found  its  full 
reward.  When,  on  the  contrary,  the  circulation  had  become  so  great, 
mines  were  being  closed  and  miners  were  being  vuincd  —  furnaces  and 
factories  were  being  sold  by  the  sheriff,  and  our  people  were  unemployed. 
In  the  one  case,  men  were  becoming  more  free,  while  in  the  olhc:  they 
were  gradually  losing  the  power  to  determine  for  themselves  to  whom 
they  would  sell  their  labor,  or  what  should  be  its  reward.  In  the  one, 
there  was  a  growing  competition  for  the  ^mrchasc  of  the  laborer's  ser- 
vices. In  the  other,  there  was  increasing  competition  for  their  .sv^/e.  Such 
having  invariably  been  the  case,  can  you,  my  dear  sir,  hesitate  to  bcb'eve, 
that  the  question  t6  whose  discussion  I  have  invited  you,  is  not  one 
of  the  prices  of  cotton  or  woollen  cloths,  but  is,  really,  that  of  man's  pro- 
gress towards  that  perfect  freedom  of  action  which  wo  should  all  desire 
for  ourselves  and  those  around  us,  on  the  one  hand,  or  his  decline  towards 
slavery,  and  its  attendant  barbarism,  on  the  other  i*  That,  as  it  seems  to 
me,  you  can  scarcely  do. 

At  no  period  in  the  history  of  the  Union  has  competition  for  the  pur- 
chase of  labor,  accompanied  by  growing  tendency  towards  improvement 
in  the  condition  of  the  laborer,  been  so  universal  or  so  great  as  in  1815, 
1834,  and  1847,  the  closing  years  of  the  several  periods  in  which  the 
policy  of  the  country  was  directed  towards  the  approximation  of  the 
producers  and  consumers  of  the  country,  by  means  of  measures  of  pro- 
tection. At  none,  ha.s  tlie  competition  for  its  sale,  with  corresponding 
decline  in  the  laborer's  condition,  been  so  great  as  in  the  closing  years 
of  the  free  trade  periods,  to  wit,  from  1822  to  1824,  and  from  1840  to 
1842. 


M 


f 


THEIR  CAUSES   AND   E'.FECTS. 


11 


Great  as  was  the  pro.spcrity  with  whif  a  wc  closed  the  period  wliicli  had 
coimiiciiccd  in  tliis  hitter  your,  three  short  years  of  the  tariff  of  1846 
sufficed  for  reproducing  tluit  competition  for  the  auk  of  hibor,  relief  from 
wliich  hud  been  the  object  of  the  men  whu  made  the  tariff  of  1842. 
From  the  decline  with  which  we  then  were  menaced,  we  were  relieved 
by  the  discovery  of  the  Californian  mines,  and  by  that  alone.  Since 
then,  we  have  thence  received  more  than  five  hundred  millions  of  gold, 
and  yet  at  no  period  has  there  existed  a  greater  tendency  to  increase 
of  competition  for  the  mlc  of  labor  than  at  present  —  the  two  cities  of 
New  York  and  I'hiladelphia,  alone,  presenting  to  our  vic^  hundreds  of 
thousands  of  persons  who  are  totaVj  unahh  to  cxdutnge  their  services  /or 
the  money  icilh  which  to  purchase  food  and  clothing.  Is  it  not  clear, 
from  all  these  facts,  that  — 

First,  the  nearer  the  place  of  consumption  to  the  place  of  production, 
tlie  smaller  must  be  the  power  of  transporters  and  other  middlemen  to 
ta.\  consunicrs  and  producers,  and  the  greater  must  be  the  power  of  the 
men  who  labor  to  profit  by  the  things  produced  ? 

Second,  that  the  more  close  the  approximati(^n  of  consumers  and  pro- 
ducers, the  smaller  must  be  the  power  of  middlemen  to  create  fictitious 
credits,  to  be  used  in  furtherance  of  their  speculations  ? 

Third,  that  the  greater  the  power  of  the  men  who  labor,  and  the  larger 
their  reward,  the  greater  must  be  the  tendency  towards  that  steadiness 
in  the  societary  action,  in  the  perfection  of  which  you  yourself  would 
find  the  proof  of  "  infallible  wisdom  in  those  who  conduct  its  operations"  ? 

Fourth,  that  all  the  experiences  of  continental  Europe,  and  all  our 
own,  tend  to  prove  that  steadiness  is  most  found  in  those  countries,  and 
at  those  periods,  in  which  the  policy  pursued  la  that  protective  one  ad- 
vocated in  France  by  the  great  Co'bert,  and  among  ourselves  by  "Wash- 
ington, Franklin,  Hamilton,  Adams,  Jefferson,  and  their  successors,  dowu 
to  Jackson ;  and  least  in  all  of  those  in  which  the  policy  pursued  is  that 
advocated  by  the  British  school,  which  sees  in  cheap  labor  and  cheap 
raw  materials  the  surest  road  to  wealth  and  power  for  the  British  trader  ? 

Renewing  my  proposition  to  cause  your  answers  to  these  questions  to 
be  republished  to  the  extent  of  not  less  than  300,000  copies,  I  remain, 
my  dear  sir,  with  grcrt  respect, 

Your  obedient  servant, 

IIenuy  C.  Carey. 
W.  C.  Bryant,  Esq. 

FuiLADELFQlA,  Jmuary  3,  1860. 


t  pro- 
nding 


12 


FINANCIAL   crises: 


♦    f 


I 


n 


LETTER    THIRD. 

Dear  Sir. — In  one  of  his  Mount  Vernon  Fujpcrs,  Mr.  Everett  in- 
forms his  readers,  that  — 

"  The  distress  of  the  year  1857  was  produced  by  an  enemy  more  "ormidable 
than  hostile  armies ;  by  a  pestilence  more  deadly  than  fever  or  plague ;  by  a.  visi- 
tation more  destructive  thaxi  the  frosts  of  Spring  or  the  blights  of  Summer.  I 
believe  that  it  was  caused  by  a  mountain  load  of  Dedt.  The  whole  country,  in- 
dividuals and  communities,  trading-Louses,  corporations,  towns,  cities.  States, 
were  laboring  under  a  weight  of  debt,  beneath  which  the  ordinary  business  rela- 
tions of  the  country  were  at  length  arrested,  and  the  great  instrument  usually 
employed  for  carrying  them  on,  Credit,  broken  down." 

This  is  all  very  true  —  a  crisis  consisting  in  the  existence  of  heavy 
debts  requiring  to  be  paid  by  individuals,  banks,  and  governments,  at  a 
time  when  oil  desire  to  be  paid,  and  few  or  none  arc  able  to  make  the 
payments.  That  admitted,  however,  we  are  not,  so  far  as  I  can  see, 
much  nearer  than  we  were  before  to  such  explanation  of  the  cauifcs  of 
crises,  as  is  required  for  enabling  us  to  determine  upon  the  mode  of 
preventing  the  recurrence  of  evils  so  frightful  as  are  tiiuse  you  have  so 
well  dcscri})ed.  Why  is  it,  that  our  people  are  so  much  more  burthencd 
with  debt  than  are  their  competitors  in  Europe  ?  Why  is  it,  that  it  so 
frequently  occurs  among  ourselves  that  all  need  to  be  paid,  and  so  few 
are  able  to  pay  ?  Why  is  it,  that  crises  alwaijs  occur  in  free-trade  times  ? 
Wliy  is  it,  that  they  never  occur  in  protective  times  ?  Why  is  it,  that 
it  so  frequently  occurs  that  those  who  are  rich  are  enabled  to  demand 
from  the  poor  settlers  of  the  West,  as  much  per  month,  in  the  form  of 
interest,  as  is  ya\(\.  per  year,  by  the  farmers  of  England,  France,  and  Ger- 
many? These  are  great  questions,  to  which  Mr,  Everett  has  furnished 
no  reply.  Let  us  have  them  answered,  and  we  shall  have  made  at  least 
one  step  toward  the  removal  of  the  evils  under  which  our  people  so 
greatly  suffer. 

Let  us  try,  my  dear  sir,  if  you  and  I  cannot  do  that  which  Mr.  Eve- 
rett has  failed  to  do — ascertaining  the  cause  of  the  existence  of  so  much 
debt,  the  constant  preliminary  to  that  absence  of  confidence  which  impels 
all  to  seek  payment,  while  depriving  so  nearly  all  of  the  power  to  pay. 

The  commodity  that  you  and  I,  and  all  of  us,  have  to  sell,  is  labor  — 
human  effort,  physical  or  mental.  It  is  the  only  one  that  perishes  at  the 
moment  of  production,  and  that,  if  not  then  put  to  use,  is  lost  forever. 
The  man  who  does  put  it  to  use,  need  not  go  in  debt  for  the  food  and 
clothing  required  by  his  family;  but  he  who  docs  not,  must  cither  con- 
tract debt,  or  his  family  must  suffer  from  want  of  nourishment.  Such 
being  the  case,  the  necessity  for  the  creation  of  debt  should  diminish 
with  every  increase  in  that  competition  for  the  purchase  of  labor,  which 
tends  to  produce  n  instant  demand  for  the  forces,  physical  or  mental, 
of  each  and  every  man  in  the  community  —  such  competition  resulting 
from  the  existence  of  a  power  on  the  part  of  each  and  every  other  man 
to  offer  something  valuable  in  exchange  for  it.     On  the  contrary,  it 


(li 


THEIR   CAUSKS    AND   EFFECTS. 


18 


srctt  ia- 


rmidable 
hy  a  visi- 
nmer.  I 
lutry,  in- 
states, 
ncHS  rcla- 
usually 

)f  heavy 
mts,  at  a 
nake  the 

can  see, 
■auscs  of 
mode  of 

have  so 
urthcncd 
hat  it  so 
id  so  few 
ic  times? 
is  it,  that 
0  demand 
e  form  of 
and  Ger- 
furnished 
Ic  at  least 
people  so 

Mr.  Eve- 
P  so  much 
ch  impels 
r  to  pay. 
s  labor  — 
lies  at  the 
it  forever. 
)  food  and 
ither  con- 
it.     Such 

diminish 
jor,  which 
or  mental, 

resulting 
other  man 
)utrary,  it 


should  Increase  with  every  increase  In  the  competition  for  the  sale  of 
labor,  resulting  from  the  absence  of  demand  for  the  human  forces  that 
are  produced.  In  the  one  case,  men  are  tending  towards  ireedom, 
whereas,  in  the  other,  they  arc  tending  in  the  direction  of  slavery — the 
existence  of  almost  universal  debt  being  ♦  j  be  regarded  as  evidence  of 
growing  power,  on  the  part  of  those  who  arc  already  rich,  to  control  the 
ruovements  of  those  who  need  to  live  by  the  sale  of  labor. 

Where,  now,  is  debt  most  univt'rsal  and  most  oppressive?  For  an 
answer  to  this  question,  let  mc  beg  that  you  will  look  to  India,  where, 
.«iiice  the  annihilation  of  her  manufactures,  the  little  proprietor  has  almost 
disappeared,  to  be  replaced  by  the  wretched  tenant,  who  borrows  at  tifty, 
sixty,  or  a  hundred  per  cent,  j)r?'  annum,  the  little  seed  he  can  afford  to 
use,  and  finds  himself  at  last  driven  to  rebellion  by  the  continued  exac- 
tions of  the  money-lenders  and  the  government.  Turn,  next,  to  those 
parts  of  llussia  whero  there  are  no  manufoctures,  and  find  in  the  freo- 
trr.de  book  of  ]M.  Tegoborski  his  stateuient  of  the  fact,  that  where  there 
is  no  diversification  of  pursuits  the  condition  of  the  slave  is  preferable 
to  that  of  the  free  laborer.  Pass  thence  to  Turkey  —  finding  there  an 
universality  of  debt  that  is  nowhere  else  exceeded.  Look,  next,  to 
Mexico,  and  find  the  poor  laborer,  overwhelmed  with  debt,  passing  into 
servitude.  Pass  on  to  Ireland,  and  study  the  circumstances  which  pre- 
ceded the  expulsion,  or  starvation,  in  ten  short  years,  of  a  million  and 
a  half  of  free  white  people — that  expulsion  having  been  followed  by  the 
passage  of  an  Act  of  Parliament  for  expelling,  in  their  turn,  the  owners 
of  the  land  from  which  those  laborers  had  gone.  Look  where  you  may, 
you  will  see  that  it  is  in  those  eomnumitics  of  the  world  which  are  most 
limited  to  the  labors  of  the  field,  that  debt  is  most  universal,  and  that 
the  condition  of  the  people  is  most  akin  to  slavery — and  for  the  reason 
that  there  it  is,  that  there  is  least  competition  for  the  purchase  of  labor. 
There,  consequently,  there  is  the  greatest  waste  of  the  great  commodity 
which  all  of  us  must  sell,  if  we  would  have  the  means  of  purchase. 

Turn,  now,  if  you  please,  to  Central  and  Northern  Europe,  and  there, 
you  will  find  a  wliolly  different  picture  —  competition  for  the  purchase 
of  labor  being  there  Gt«adily  on  the  increase,  with  constant  augmenta- 
tion of  the  rapidity  of  commcirco  —  constant  increase  in  the  power  to 
economize  the  great  commodity  of  which  I  have  spoken  —  and,  as  a  ne- 
cessary consequence,  constant  diminution  in  the  necessity  for  the  con- 
traction of  debt.  Why  should  such  remarkable  differences  exist  ?  Be- 
cause, in  all  of  these  latter  countries,  the  whole  policy  of  the  country 
tends  tctwards  emancipation  from  the  British  free-trade  system,  whereas 
India,  Ireland,  Turkey,  and  Mexico,  are  becoming  from  day  to  day  more 
subject  to  it. 

Looking  homeward,  we  may  now,  my  dear  sir,  inquire  when  it  has 
been,  that  the  complaint  of  debt  has  been  most  severe.  Has  it  not  been 
in  those  awful  years  which  followed  the  free-trade  speculations  of 
1816-17?  Has  it  not  been  in  that  terrific  period  which  followed  the 
free-trade  speculations  of  37  to  '40  —  that  period  in  which  a  bankrupt 
law  was  forced  from  Congress,  as  the  only  means  of  enabling  tens  of 
thousands  of  industrious  men  to  enter  anew  upon  the  business  of  life  .' 
Has  it  not  been  in  the  years  of  the  present  free-trade  crisis,  which  pre- 
sent to  view  private  failures  of  almost  five  hundred  millions  in  amount? 


i 


^ 


14 


FINANCIAL  CRISES  ; 


■When,  on  the  other  hand,  has  there  been  least  complaint?  Has  it  not 
been  in  tlioHc  tranquil  years  which  followed  the  passage  of  the  protective 
tariffs  of  '2H  and  '42  ?  That  it  has  been  so,  is  certain.  Why  should  it 
80  have  been  ?  Because  in  j)rotective  times  every  man  has  found  a  pur- 
chaser for  his  labor,  and  has  been  thereby  relieved  from  all  necessity  for 
contracting-  debt;  whereas,  in  free-trade  times,  a  large  portion  of  the  labor 
power  produced  has  remained  unemployed,  and  its  owners,  unable  to  sell 
their  one  commodity,  have  been  forced  to  choose  between  the  contraction 
of  debt  on  the  one  hand,  or  famine  and  death  on  the  other. 

Look  next,  my  dear  sir,  to  our  public  debt,  and  mark  its  extinction 
under  the  tariff  of  '28  —  its  revival  under  the  compromise  tariff — its 
reduction  under  that  of  '42 — and  then  study  the  present  situation  of  a 
national  treasury  that,  in  time  of  perfect  peace,  is  running  in  debt  at 
the  rate  of  little  less  than  ^20,000,000  a-ycar ! 

Turn  then,  if  you  please,  to  our  debt  to  foreigners,  which  was  anmhi- 
Intal  under  the  tariff  of  '28 — swelled  to  hundreds  of  millions  under  the 
tariff  of  'o3  —  and  since  so  much  enlarged,  under  the  tariffs  of  '46  and 
'57,  that  the  enormous  sum  of  ^30,000,000  is  now  required  for  the  pay- 
ment of  its  annual  interest. 

France,  with  a  population  little  larger  than  our  own,  and  one  far  less 
instructed,  maintains  an  army  of  000,000  men  —  carries  on  distant  wars 
— builds  magniiicent  roads — enlarges  her  marine  and  fortifies  her  ports 
—  and  docs  all  these  things  with  so  much  ease,  that  when  the  govern- 
ment has  suddenly  occasion  for  $100,000,000,  the  whole  is  supplied 
at  home,  and  without  an  effort.  Belgium  and  Germany  follow  in  the 
same  direction  —  not  only  making  all  their  own  roads,  but  contributing 
largely  to  the  construction  of  those  which  are  used  for  carrying  out  the 
rude  products  of  our  land,  and  bringing  back  the  cloth,  the  paper,  and 
the  iron,  that  our  own  people,  now  unemployed,  would  gladly  make  at 
home.  They  are  rapidly  becoming  the  bankers  of  the  world,  for  they 
live  under  systems  even  more  protective  than  were  those  of  our  tariffs 
of  '28  and  '42.  We,  on  the  contrary,  are  rapidly  becoming  the  great 
paupers  of  the  world  —  creating  seven,  eight,  and  ten  per  cent  bonds, 
and  then  selling  them  at  enormous  discounts,  to  pay  for  iron  so  poor  in 
quality  that  our  rails  depreciate  at  the  rate  of  five,  six,  and  even  ten  per 
cent  a-year. 

Looking  at  all  these  facts,  is  it  not  clear,  my  dear  sir  — 

That  the  necessity  for  the  contraction  of  debt  exists,  throughout  the 
world,  in  tlie  ratio  of  the  adoption  of  the  free-trade  system  of  which  you 
are  the  earnest  advocate  'i 

That  the  greater  the  necessity  for  the  contraction  of  debt,  the  greater 
is  the  liability  to  the  recurrence  »if  commercial  crises  such  as  you  have 
80  well  described  't 

That  the  more  frequent  the  crises,  the  greatei  is  the  tendency  toward.* 
the  subjection  of  the  laborer  to  the  will  of  his  employer,  and  towards 
the  creation  of  slavery  even  where  it  has  at  present  no  existence  ?  And, 
therefore  — 

That  it  is  the  bounden  duty  of  every  real  lover  of  freedom  to  labor 
for  the  re-estabiishmcnt  of  the  protective  system  among  ourselves? 


TIIEIR  CAUSES  AND  EFFECTS. 


15 


At  font*  Ih  (fivon,  nn  you  hoo,  your  notice  of  refusal  to  enter  upon  the 
dlHcuHMion  to  which  yun  have  been  invited.  For  a  reply  thereto,  permit 
iiif,  my  (Icur  nir,  to  refer  you  to  the  followin<^  exposition  of  your  own 
viewM  in  reflation  to  I'ree  discussion,  given  by  yourself,  a  few  days  since, 
ill  the  J'Jviiuii;/  J'oHt, : 

"TiioMK  I'oi.rriOAi,  hv.v.rvHKf*. — As  our  readers  know,  a  project  has  been  under 
cnnsiileriitliin  to  filvo  n  course  nC  political  lectures  in  this  city  during  the  present 
wiutor,  ttiiU  ill  wliicli  our  prominent  politicians  of  all  parties  were  to  be  invited 
to  tako  a  ptirt.  Wo  now  tin(lerf<tand  that  tht  scheme  has  fallen  through,  mainly 
beeauiso  no  Mhi^lo  l^oinocrat  could  be  found  who  was  willing  to  ventilate  his  party 
ojiiniiJiiH,  and  ninintain  them,  in  connection  with  a  series  of  similar  addresses  by 
llepublican,  lladicul,  and  American  speakers.  Wo  are  assured  that  of  twenty 
Northern  and  Hontheiii  Democratic  statesmen,  who  have  been  invited,  not  one  lias 
ftccoptiMl  iho  Invitation.  It  is  proper  to  say  that  the  signatures  to  the  letter  in- 
viting HjtoakerM  rt'iircscnted  a  number  of  our  very  foremost  citizens,  of  all  shades 
of  p()litii!H,  If  II  letter,  so  respectably  signed  as  to  guarantee  every  courtesy  to 
nil  wlio  took  part  in  the  course,  failed  to  secure  at  least  one  speaker  to  uphold 
Deiuocratic  prindplcM,  we  may  safely  suggest  that  the  old  souhruptel  of  the  "im- 
terrifled  UeiiMuirucy "  is  ii  misnomer.  We  regret  the  failure  of  the  proposed 
coui'Ho  of  luctureH,  but  are  glad  to  know  that  many  llepublicans  were  willing  to 
participate.  Why  cannot  wo  La>e  u  few  llepublicau  speakers  in  an  independent 
comso?" 

Obviounly,  tlieno  Democrats  fear  discussion.  For  years,  they  have 
been  odvociitiiig  doctrines  that  will  not  bear  examination  before  the 
people.  Wliat,  liowever,  shall  we  say  to  the  froc-trade  advocates?  Is 
there  any  oiks  of  thnn  that  would  accept  a  proposition  like  to  the  one  to 
which  you  huvo  here  referred?  Would  they  even  accept  an  offer  that 
was  HO  much  hiitter  than  this,  that  it  would  give  them,  of  cool  and  reflect- 
ing renders,  jUii;  huntlrrd  times  an  many  as  you  could  give  to  any  Demo- 
crat, of  men)  auditors  ?  Would  Mr.  Ilallock,  of  the  Journal  of  Com- 
meire,  u(!eept  tlio  niagnificent  oft'er  I  have  made  to  you,  which,  thus  far, 
you  liavo  not  iiecepted?  Would  it  be  accepted  by  Mr.  Greene,  of  the 
liohton  Mornlnii  Punt?  W^ill  you  accept  it?  If  you  will  not,  can  you 
object  to  the  eour»o  of  the  Democratic  leaders  to  whom  you  have  here 
referred '(     Scarcely  so,  as  I  think. 

Hoping  to  hear  tliat  you  have  renonsidorcd  the  question,  and  have 
decifled  to  aectMle  to  a  proposition  which  will  enable  you  to  address  to  a 
mlllldii.  mill  a  haff  of  rvailvrs,  all  the  arguments  that  can  be  adduced  in 
supjiort  of  I'rcc-tradc  doctrines,  I  remain,  my  dear  sir. 

Very  truly  aud  respectfully  yours, 

Henry  C.  Carey, 
w.  c.  duyant,  e«q. 

PHiijADELniiA,  January  17,  1860. 

*  "Mil,  Cauuv'h  rilAT,i,F,N(iK. — ^Ir.  Henry  C.  Carey,  of  Philadelphia,  known 
by  varloMH  wofkn  on  political  economy,  has  challenged  Mr.  Bryant,  one  of  the 
editors  of  thiN  paper,  to  a  dic^cussion,  in  tlie  newspapers,  of  the  question  of  cus- 
tom-liouMO  tivxatloti.  In  behalf  of  Mr.  Bryant,  we  would  state  that  challenges  of 
this  kind  iio  iicltiior  gives  nor  accepts.  It  would  almost  seem  like  affectation  on 
hiB  part  to  Hay  tliat  ho  has  not  read  the  letters  —  two  in  number,  he  is  told  —  in 
whicli  thiH  deflanco  Ih  given  on  the  part  of  Mr.  Carey,  having,  unfortunately,  too 
little  cnrioHity  to  kpg  In  what  terms  it  is  expressed ;  but  as  such  is  the  fact,  it  is 
well  perhftpH  to  mention  it.  His  duties  as  a  journalist,  and  a  commentator  on  the 
eveutu  olf  the  duy  uud  the  various  interesting  questions  which  they  suggest,  leave 


»t| 


16 


FINANCIAL  crises: 


him  no  time  for  a  sparrinK-mntch  with  Mr.  Carey,  to  which  l#io  public,  after  a  little 
while,  woulii  pay  no  attention ;  and  if  he  hail  over  ho  much  time,  and  the  public 
were  ever  so  mucli  interested  in  wliat  lie  had  to  Hay,  ho  has  no  ambition  to  diatin- 
guish  himself  IIS  a  public  dlHputant.  His  business  is  to  enforce  what  he  considers 
important  politii'al  truths,  and  refute  what  seem  to  him  errors,  just  as  the  occa- 
sions arise,  and  to  puch  extent  as  he  imiigines  himself  able  to  secure  the  attention 
of  those  who  read  this  journal,  and  ho  will  not  turn  aside  from  this  course  to  tie 
himself  down  to  a  tedious  dispute  concerning  the  tariff  question  at  any  man's 
invitation . 

«'  The  question  of  the  tariff  is  not  the  principal  controversy  of  the  day.  It  may 
seem  so  to  Mr.  Carey,  who  is  suffering  under  a  sort  of  monomania,  but  the  public 
mind  is  occupied  just  now  with  matters  of  graver  import.  To  them  it  is  proper 
that  a  journalist  should  principally  address  himself,  until  they  are  disposed  of. 
He  may  make  occasional  skirmis'hcH  in  other  ftelds  of  controversy,  but  hero  is  the 
main  battle.  When  the  tariff  question  comes  up  again,  it  will  bo  early  enough  to 
meet  it ;  and  even  then,  a  journalist  who  understands  his  vocation  would  keep 
himself  free  to  meet  it  in  his  own  way. 

"  If  Mr.  Carey  is  anxious  to  call  out  seme  antagonist  with  whom  to  measure 
weapons  in  a  formal  combat,  and  can  find  nobody  who  has  an  equal  desire  with 
himself  to  shine  in  controversy,  we  can  recommend  to  him  a  person  with  whom  he 
can  tilt  to  his  heart's  content.  One  Henry  C.  Carey,  of  Philadelphia,  published, 
some  twenty  years  since,  a  work  in  three  volumes,  entitled  '  Principles  of  Political 
Economy,'  in  which  ho  showed,  from  the  experience  of  all  the  world,  that  the 
welfare  of  a  country  is  dependent  on  its  freedom  of  trade,  and  that,  in  proportion 
as  its  commerce  is  emancipated  from  the  shackles  of  protection,  and  approaches 
absolute  freedom,  its  people  are  active,  thriving,  and  prosperous.  We  will  put 
forward  Henry  C.  Carey  as  the  champion  to  do  battle  with  Henry  C.  Carey.  This 
gentleman,  who  is  now  8(  full  of  fight,  will  have  ample  work  on  his  hands  in  de- 
molishing tho  positions  of  his  adveraary,  with  which  ho  has  the  great  advantage 
of  being  already  perfectly  familiar.  When  that  is  done,  which  will  take  three  or 
four  years  at  the  least,  inosmuch  as  both  the  disputants  are  voluminous  writers, 
we  would  suggest  that  he  give  immediate  notice  to  his  associates,  the  owners  of 
tho  Pennsylvania  iron-mills,  who  will  doubtless  lose  no  time  in  erecting  a  cast-iron 
statue  in  houoi  of  tho  victor." 


Tllf.Itl  CAtlHES   AND   EFFECTS. 


vr 


LETTER  FOURTH. 

Dkar  8iR,— 111  th«  notice  of  your  refusal  to  enter  upon  the  discua- 
sion  to  which  you  hiivo  huon  invited,  it  is  suid  that  you  "hud  not  read 
the  letters "  thiit  hnd  boon  nddresHcd  to  you.  That  such  had  been  the 
case,  is  not  nt  till  improbable  j  but  how  far  a  great  public  teacher,  as 
you  undoubtedly  arc,  can  bo  held  justified  in  closing  his  eyes  when 
invited  to  u  calm  exiimiiiatioii  of  the  <|uestion  whether  his  teachings  tend 
in  the  direction  of  pro«perity  and  freedom  for  the  laborer,  on  the  one 
hand,  or  toward  ptuiperi»u»  and  slavery  on  the  other,  seems  to  me  to  be 
far  less  certain.  J'lactid  myself  in  his  situation,  I  should  regard  it  as 
one  of  groat  roHpoiiHibllity  — one  in  which  erroneous  action,  resulting 
from  failure  to  givo  to  the  subject  the  iullest  and  fairest  examination, 
would  bo  little  Hliort  of  tho  wilful  nnd  deliberate  commission  of  crime. 
That  you  agroo  with  itio  in  this,  I  cannot,  even  for  a  moment,  doubt. 

That  you  had  not  read  the  notice  served  upon  me,  I  regard  as  abso- 
lutely certain,  and  for  tho  renoon,  that  its  tone  and  manner  are  entirely 
unworthy  of  yoii,  and  you  would  not,  I  am  sure,  permit  anything  to  be 
said  by  others  fop  you,  that  you  would  not  spy  yourself.     Further,  you 
are  there  placed  in  tlio  false  position  of  doing  what  1  know  you  would 
not  do — shrinking  fVoin  responsibility,  by  permitting  yourself  to  be  pre- 
sented to  tho  world  UN  being  only  "  one  of  the  editors"  of  the  Post,  in- 
stead of  tJie  editor,  us  you  uro  so  well  known  to  be.     Mr.  Greeley  is  the 
editor  of  hin  paper,  and,  us  such,  endorses  the  opinions,  given  editorially, 
of  tho  many  geiitluiiion  by  whom  he  is  aided.     So,  too,  is  it  with  your- 
self; and  tho  rule  uf  looking  to  the  endorser  when  the  drawer  cannot 
be  found,  aprdicH  in  this  case  as  fully  as  it  can  do  in  that  of  a  promis- 
sory note,    bo  far  an  1  can  recollect,  the  editor  of  the  Tribune  has  never 
shrunk  from  any  Huoh  responsibility  —  having  repeatedly  replied,  oyer 
his  own  signaturu,  to  papers  addressed  to  himself  in  reference  to  editorials 
that  ho  had  publiHliou.    Quito  sure  I  am,  that  were  you  now  to  cite  him 
before  tho  world,  m  I  have  cited  you,  demanding  an  examination  of  the 
principles  upon  whioh  ho  had  based  his  advocacy  of  protection,  he  would 
most  gladly  meet  yuu  —  giving  to  all  you  had  to  say  the  benefit  of  his 
enormous  circulation,  atnf  leaving  his  readers  to  decide  for  themselves, 
after  calm  porunal  of  your-arguments.     Like  you,  he  might  find  it  quite 
impossible  to  glvo  to  the  question  all  the  attention  it  might  demand,  but, 
in  that  ciiso,  hu  would,  most  assuredly,  find  some  one  to  take  his  place — 
becoming  respoiislblo,  us  editor,  as  fully  as  if  he  alone  had  written.    Like 
him,  you  are  surroundod  by  persons  who  have  treated  this  subject  on  hun- 
dreds, if  not  even  thousands,  of  occasions — you  making  yourself  respon- 
sible for  all  they  havo  thus  far  said;  and  I  am,  therefore,  at  a  loss  to  un- 
derstand why  you  should  now  fail  to  profit  by  the  admiralile  opportunity 
offered  you,  for  CMtablishing  the  truth  of  free-trade  doctrines.    Can  it  be, 
that  their  advocates  dufv  nut  meet  the  question  ?     If  so,  are  they  not 
now  placing  thoinNolvoH  in  a  situation  precisely  similar  to  that  so  recently 
described  by  you,  in  Hpeakiiig  of  your  Democratic  opponents '! 
m 


18 


FINANCIAL  crises: 


10 


1  am  told,  however,  that  this  \n  not  the  principal  question  of  the  day. 
It  niaj  not  bo  so  with  the  {leople  of  your  city,  but  you  would  greatly  err, 
were  you  to  siippose  that  such  was  the  case  with  those  of  the  States 
south  and  west  of  you,  and  north  of  Mason  and  Dixon's  line.  In  this 
State  and  Jersey,  it  is  the  one,  and  almost  the  onli/  quostion.  In  Ohio, 
a  large  majority  of  the  Republican  senators  are  stated  to  have  announced 
their  distinct  intention  to  make  it  the  question.  In  Illinois,  the  most 
influential  of  all  the  Republican  journals  of  the  State  has  entirely  aban- 
doned the  free-trade  doctrines — giving  itself  now  to  the  advocacy  of  pro- 
tection. Throughout  the  West,  the  question  of  the  adoption  of  measures 
required  for  the  creation  of  domestic  markets,  and  for  the  emancipation 
of  the  country  from  the  control  of  British  manufacturers,  is  rapidly 
taking  the  place  heretofore  so  exclusively  occupied  by  the  anti-slavery 
one.  All  of  these  people  may  be  Avrong,  and,  if  so,  they  should  be  set 
right.  That  they  may  be  so,  I  have  offered  you  the  use  of  the  columns 
of  protectionist  journals,  circulating,  to  the  extent  of  hundreds  of  thou- 
sands of  copies,  among  the  very  persons  who  are  thus  in  error.  That 
great  offer  it  is  that,  thus  far,  you  have  not  accepted. 

The  great  question  of  the  day,  in  your  estimation  is  that  of  slavery 
and  freedom,  and  in  this  we  arc  entirely  agreed.  How  is  it  that  men 
may  be  made  more  free?  That  is  the  question,  and  it  must  be  answered 
before  we  can  venture  upon  action,  unless  we  arc  willing  to  incur  the 
risk  of  promoting  the  growth  of  slavery,  while  really  desiring  to  advance 
the  cause  of  freedom.  All  experience  shows,  that  men  have  become 
more  free  as  they  have  been  more  and  more  enabled  to  work  in  combina- 
tion with  each  other,  and  that  the  power  of  combination  grows  as  em- 
ployments become  more  diversified — slavery,  on  the  other  hand,  growing 
in  all  those  countries  in  vvhich  men  arc  becoming  more  and  more  limited 
to  the  labors  of  the  field.  Such  being  the  case,  that  policy  which  tends 
to  produce  diversification  and  combination  should  be  the  one  which  would 
lead  to  freedom.  Which  of  the  two  is  it,  protection  or  free  trade,  which 
tends  in  that  direction  ?  For  an  answer  to  this  (juestion,  we  need  but 
look  to  Northern  and  Central  Europe  —  finding  there  the  protective  sys- 
tem in  full  vigor,  and  the  people  rapidly  advancing  in  wealth,  strength, 
freedom,  and  power.  The  opposite,  or  free-trade  system,  has  been  in 
active  operation  in  India,  Ireland,  Turkey,  and  other  countries,  whose 
people  are  as  rapidly  declining  towards  poverty,  slavery,  and  general 
demoralization. 

How,  my  dear  sir,  has  it  been  among  ourselves  ?  Turn  to  the  years 
which  followed  the  abandonment  of  the  protective  policy  in  181G,  and 
study  the  rapid  growth  of  pauperism  and  wretchedness  that  was  then  ob- 
served. Pass  on  to  those  which  followed  the  passage  of  the  protec- 
tive tariffs  of  1824  and  1828,  and  remark  the  wonderful  change  towards 
wealth  and  freedom  that  was  at  once  produced.  Study  next  the  growth  of 
pauperism  and  destitution  under  the  compromise  tariff",  closing  with  the 
almost  entire  paralysis  of  1840—42.  Pass  onward,  and  examine  the  action 
of  the  tiiriff"  of  1842  —  remarking  the  constant  increase  in  the  demand 
for  labor — in  the  production  and  consumption  of  iron,  and  of  cotton  and 
woollen  goods  —  and  in  the  strength  and  power  of  a  community  which 
had  so  recently  been  obliged  to  apply,  and  that  in  vain,  at  all  the  bank- 
ing houses  of  Europe,  for  the  small  amount  of  money  that  then  was 


TDETR  CAUSES   AND   EFFECTS. 


10 


needed  for  carrying  on  the  governnuMit.  Look,  next,  to  the  repeated 
crises  we  have  had  under  the  tariffs  of  1X4(>  and  1S57 — each  and  all  of 
them  tending  toward  strengthening  the  rich,  while  weakening  the  poor, 
and  promoting  a  growth  of  jiauporisin  siieh  as  has  never,  1  helieve,  been 
known,  in  any  country  of  the  civilized  world,  to  be  aeconiplislied  in  so 
brief  a  period.  Such  having  been  the  result,  the  questions  now  arise, 
—  Whither  aro  wc  tending?  Is  it  not  toward  slavery  for  the  white 
laborer '(  Those  are  the  questions  I  have  desired  to  have  di,scu.sscd,  and 
whatever  you,  my  dear  sir,  may  think  of  it,  they  must  be  always  in  order. 
These,  however,  as  may  bo  snid,  arc  mere  facts  —  a  sort  t}^  politico t 
arithmetic.     Trade  should  be  free,  and  any  facts  that  may  be  produced 

in  opposition  to  that  theory,  must  be  such  as  cannot  be  relied  on That 

wc  should  be  always  going  in  the  direction  of  freedom  of  commerce,  and 
freedom  of  man,  1  fully  and  freely  admit ;  but  what  is  the  road  which 
leads  in  that  direction?  Certainly,  not  the  one  on  which  wc  recently 
have  travelle<l  —  all  our  present  tendencies  being  toward  pauperism  and 
slavery,  for  the  white  man  and  the  black.  As  certainly,  it  i  the  one  on 
which  we  travelled  in  the  years  of  the  period  of  the  tariffs  of  1828  and 
1842;  and  if  you  desire  any  evidence  of  this,  you  have  but  to  look  to 
the  most  distinguished  free-trade  writers  of  the  present  century  —  their 
teachings  and  mine  being  in  full  accordance  with  each  other. 

Seeking  proof  of  this  assertion,  allow  me,  my  dear  sir,  to  request 
that  you  will  turn  to  Mr.  J.  B.  Soi/,  and  study  the  cases  described  by 
him  as  being  those  in  which  "protection,  granted  with  a  view  to  promote 
the  profitable  apj)lication  of  labor  and  capital,  may  become  productive 
of  universal  benefit."  Look  next,  if  you  please,  to  Mom.  Bhinqvi,  his 
successor,  and  find  him  assuring  his  readers  that  "  experience  had  already 
taught,  that  a  people  ought  never  to  deliver  over  to  the  chances  of  a 
foreign  trade,  the  fiitc  of  its  manufactures."  I'ass  on  to  Mons.  liossi, 
and  read  his  entire  disclaimer  of  the  idea  of  non-intervention  by  the 
government — holding,  as  he  does,  that  "a  prudent  and  enlightened  ad- 
ministration requires  the  making,  in  view  of  probable  future  benefit,  of 
advances  that  may  not,  possibly,  be  repaid  in  full."  Turn  thence  to 
Mr.  J.  S.  Milt,  who  tells  his  readers,  that  "  the  superiority  of  one  coun- 
try over  another,  in  any  brancli  of  production,  often  arises  only  from 
having  begun  it  sooner,  and  that  a  country  which  has  skill  and  expe- 
rience yet  to  acquire,  may,  in  other  respects,  be  better  adapted  to  the 
production  than  others  th.at  were  earlier  in  the  field;"  but,  that  "it 
cannot  be  expected  that  individuals  should,  at  their  own  risk,  or,  rather, 
at  their  ccrtiiin  loss,  introduce  a  new  manufacture,  and  bear  the  burlhen 
of  carrying  it  on,  until  the  producers  have  been  educated  up  to  the 
level  of  those  with  whom  the  processes  have  become  traditional."  Look 
next  to  Mons.  Chevalier,  and  learn  that  not  only  "  it  is  not  an  abuse  of 
power  on  the  part  of  the  government,"  but  that  *'  it  is  only  the  aocom- 
plishment  of  a  positive  duty,  so  to  act  at  each  epoch  in  tl'e  progress  of 
a  nation,  as  to  favor  the  taking  possession  of  all  tlu;  branches  of  industry 
whose  acquisition  is  authorized  by  the  nature  of  things."  The  govern- 
ment which  fails  to  do  this,  "makes,"  as  he  thinks,  "  a  great  mistake." 

You  have  here,  my  dear  sir,  the  views  of  five  of  the  most  eminent 
European  economists  of  the  present  century — all  of  them  high  authori- 
ties la  the  free-trade  school,  and  yet  all  concurring  in  the  views  I  have 


20 


nNAN<"rAI,  f'RIHES: 


«'X|ir»'N«((|  to  yon,  FnctH  arid  tlicoricH  iHifij:  tliUN  in  oppn.xition  to  your 
•I'xlriii' I',  in  if  not  time  flmf.  you  mIiouM  uii'lcrtuko  uiu;W  the  oxuniina- 
tiori  ol'  llif!  (jncufiori,  wiili  a  vi<!W  to  hutiHCy  your><H'  wlifthor  the  teuch- 
in^'M  of  Ihc  /'nut  nn;  n;iilly  thoMc?  of  Hiavory  or  of  I'rcvihmi'f 

I  am  lolil  lliiit  I  wuH  once  a  fnr-tradcr,  uii<l  nothing  can  ho  more  true. 
Ciiriful  hlii'ly  ol'  (h<!  ohftnonicnu  of  tho  fnMi-trath;  convulsion  of  1840- 
4lf,  ami  of  tin-  |pritti'(tiiiiiiMt  nnival  of  lSpJ-47,  havinj:,  however,  Hutia- 
fliil   Mif  thai,  that,  the  liictH  aii'i   tli(!  th(!orv  ctmhl   not  a'Teo,  I  Wiw  led 


Hlioly 


anew 


the   latter,  und  iintl  llu;  cause  of  error.     That  found, 


I  fell  no  more  ditlieiilty  in  adniittin;:  tluit  I  had  he(;n  wron<;,  than  would 
he  fell,  hy  V'*'"'^*'"'.  "'ler  you  Hhould  have  tried,  and  vaiidy  tried,  to 
eMialdiMh  (he  fact,  (hat  (he  eauHe  of  freedom  wan  to  he  promoted  by  a 
t   'licy  that  He|iara((!d    the  producer  from  (he  eonwumer  —  placing  the 


.11 


id  1 


caving 


the  plough  and  the 


mile  and  the  loom  Oil  one  continent,  am 
liatrow  oil  (he  other. 

At  the  moment  of  inviting  you  to  join  with  uie  in  nn  inquiry  as  to 
the  real  road  towanlH  wealth  and  freedom  for  our  people,  haruioiiy  for 
our  I'nioii,  ami  prosperity  ami  power  for  our  griiat  Conledoracy  —  that 
imiuiiy  to  he  eiuidiieled  in  the  spirit  of  men  who  sought  for  truth,  and 
not,  for  victory  —  I  had  still  some  lingering  douhts  (d'  your  acceptance; 
ami  yet,  it  appeared  to  me  that  you  yourself  should  1)C  quite  as  anxious 
for  it  as  I,  hy  any  possihility,  could  he. — Desirous  (o  remove  all  'jiflieulty, 
the  spae«»  to  he  given  was  left  to  your  decision  —  the  greatness  of  the 
sulijeet  seeming  to  me  (o  give  a.ssuranee  (hat  the  inquiry  would  be  allowed 
to  iissiime  proportions  somewhat  in  aeeordance  with  those  (d' the  interests 
to  he  discussed.  Pledged,  as  wo  slunild  he,  to  the  cause  of  truth,  and  to 
that  nlont>,  any  previous  involveim>nts,  on  either  side,  would  shrink  into 
utter  insignilieanee.  NeitluT  of  us,  as  it  seemed  to  inc,  need  he  so  anxious 
tt>  shim>  in  (he  <lispute  as  (o  liesitate  at  any  risk  that  we,  as  individuals, 
might  run  -pledged  as  we  were,  hy  all  our  j)a.'«t  hi.story,  to  give  to  this  one 
great  question,  tin*  most  frank  and  candid  examination. 

Kegretting  that  vtui  have  uot,  thus  fur,  boon  able  to  agree  with  me  in 
the  view  that  has  been  here  presented,  but  hop  «g  that  you  may  yet  do 
ho,  1  remain,  with  great  re>peet, 

Yours,  very  truly, 

Henry  C.  Carey. 

>V.  t\    1'>U\  ANV,   V.*\t. 

ruii..Mn.irHi  V.  January  24,  1S59. 


r^ 


(3) 


r! 


TIIKIR    .'AI'SHS    AM)    KI  IHTS. 


21 


LETTER    FIFTH. 

Dear,  Sih.  —  A  Inrtni^iht  hIiico,  you  stated,  on  tlid  autliority  of  Dr. 
Wynne,  that  imiiptrisni  in  the  Htato  ot'  Now  York  hiul  iissiinu'd  ))i(t|)ur- 
tionH  relatively  <iiciitcr  than  those  of  Knj^land  or  of  Scot  land,  and  "  iariri  ly 
in  advunco"  of  even  the  downti'odden  and  unhappy  Ireland — your  per- 
centaj;e  being  as  high  as  7.40,  or  more  than  double  that  ol'  all  the  Itri- 
tish  l8land.s.  When  these  I'acts  wore  first  presented  to  your  sanitary 
society,  they  appeared  to  the  nmnagers  "so  Btartling  as  to  lead  them  to 
doubt  their  accuracy,  but,"  as  you  now  have  told  your  readers,  "  after 
the  most  careful  scrutiny,  they  have  not  only  atlopted  them,  but  given 
them  currency  as  authority  in  their  report.  This  "  condition  of  facts" 
is  one  that,  as  you  think,  "  calls  for  investigation  by  flic  proper  authori- 
ties"—  the  alarming  facts  being  presented  for  their  cmisideratidn,  that 
no  Icsa  than  forty-one  per  cent  of  the  paupers  are  native  born,  and  that 
the  terrible  disease  of  pauperi.^m  appears,  "like  the  Camidian  thistle,  to 
have  settled  on  our  soil,  an<l  to  have  germinated  with  such  vigor  as,"  in 
your  opinion,  "  to  defy  all  half  measures  to  eradicate  it." 

The  pauper  is  necessarily  a  slave  to  those  who  feed  and  cl(»the  him, 
and  a  slave,  too,  more  abject,  as  a  general  rule,  than  are  even  tl»^  negroes 
of  the  South.  White  slavery  thus  grows  steadily  —  furni.shing  good 
reason  for  the  fears  that  you  have  here  ex]irossed.  Kqual  cause  fur  such 
alarm  may  be  found,  however,  in  the  fact  that  the  growth  in  the  number 
and  power  of  your  millionaires  keeps  even  pace  therewith — growing  ine- 
quality of  condition  here  furnishing  conclusive  proof  of  decline  in  civi- 
lization and  in  freedom.  How  is  it  that  such  effects  are  being  produced? 
Here  is  a  great  question,  the  solution  of  which  may,  as  I  think  you  will 
agree  with  me,  bo  found  in  the  following  frightful  facts,  which  have  just 
now  been  given  to  the  world,  and  which  revetil  a  state  of  things  well 
calculated  to  carry  the  alarm  of  which  you  speak,  into  the  breast  of  every 
man  who  takes  an  interest  in  our  future. 

In  your  city  there  arc  5G0  tenement  houses,  containing,  by  actual 
enumeration,  10,95>3  families,  or  about  05  persons  each;  l!);J  with  111 
each;  71  others,  with  140  each;  and,  finally,  20,  that,  as  we  are  told, 
are  the  most  pi'ofitablc,  and  that  have  a  total  population  of  no  les-s  than 
5449  souls,  or  1S7  to  each.  AV'hat  are  the  accommodations  therein  pro- 
vided for  the  wretched  occupants,  is  shown  in  the  following  picture : 

"One  of  the  largest  nnd  most  recently  built  of  the  New  York  'barracks'  has 
apartments  for  12()  families.  It  was  built  especial'y  for  this  use.  It  stands  on  a 
lot  50  by  250  feet,  is  cntereJ  at  the  sides  from  alloys  eight  feet  wide,  and,  liy 
reason  of  the  vicinity  of  another  barrack  of  equal  height,  the  rooms  are  so  dark- 
ened that  on  a  cloudy  day  it  is  impossible  to  read  or  sew  in  thorn  without  artificitil 
light.  It  has  not  one  room  which  can  in  any  way  be  thoroughly  ventilated.  The 
vaults  and  sewers  which  are  to  carry  off  the  filth  of  the  12G  families  have  prated 
openings  in  the  alleys,  and  doorways  in  the  cellars,  through  which  the  noisome 
and  deadly  miasmata  penetrate  and  poison  the  dank  air  of  the  house  and  tlio 
courts.     The  water-closets  for  the  whole  vast  establishment  are  a  range  of  stalls 


83  riNANtlAL   CIUPEH: 

witlinnt  (loom,  mi'l  (\ccp?HiMo  nnt  only  fidin  tin-  Imilillnjr,  biitcTon  from  tlio  «(rr«l, 
Conit'ort  is  lirn'  out  of  thn  rinc-tion  :  foiiiiin'ii  (h-eency  Iiiib  hpin  n'iiil.T«i|  itiipiM- 
Bible ;  anil  thu  lioi riblo  bnHiilitios  of  tlii'  |iiii'>'PM)roi-y'hi|)  ure duy  iiCtrr  ilny  i<'|iciili'i|, 

but  on  a  lurn;i'r  hciiU".     Ami  yt,  this  in  a  fiiir  spfcinieii.     Ami  lor  kiicIi  hiijitoim 

nnil  n(ci':^»arily  (U'moiali/.inn  liuliitaiinnn,— tor  two  vimuh,  Munuh,  imU'Ci'Muy,  niitl 
gloom,  till)  jionr  family  jmyn-  and  tim  riuh  builder  rcceivun — •Ihirty-jivi  pir  eint 
aummlhj  on  the  cost  nf  tht  apartmnili ."  " 

W'o  hiivc  licro  tho  t}po  of  the  systoin  tliat  is  now  more  niid  mom  oli. 
taitiirif^  tbrotifrhoul  tho  country.  Ono  fiiiiiiiciul  convulsion  follow*  uii< 
other,  cnch  in  its  turn  dosing  mills,  mines,  and  furniiccs,  iind  thilH 
dcstroyihi,'  intcnml  commerce.  With  every  step  in  that  direction,  our 
people  lire  more  compelled  to  seek  the  cities,  and  thereby  uu^'menlinj;  tho 
power  of  the  rich  to  dem:ind  enormous  rents,  usurious  inl crest,  uiid 
enormous  prices  for  lots — tlieir  fortunes  growing  rapidly,  wliile  reducfin^ 
thousands,  and  tens  of  thousands,  to  u  state  of  pauperism  and  destitution, 

Is  it,  however,  among  the  occupants  of  tenement  houses,  alone,  tliiit 
wc  are  to  find  the  fiicts  wliich  indicate  the  decline  to  which  I  havi)  re 
ferred  —  a  decline  which  viiiHt  ho  arrested,  if  we  desire  not  io  find  tho 
end  of  our  great  republic  is  anarchy  and  despotism?  Look  around  you, 
and  you  will  see  that  while  our  poi»ulation  is  growing  at  the  rate  of  u 
million  a-year,  there  is  a  daily  diminution  in  the  deiiumd  for  skilhMl  labor 
to  be  applied  to  tho  conversion  of  raw  materials  into  finished  cominodi« 
tics  —  a  daily  diminution  of  that  citnfidenco  in  the  future  w)ii(di  In  w- 
quired  f»)r  producing  applications  of  capital  to  the  developuKtut  of  our 
groat  natural  resources  —  a  daily  increase  in  the  necessity  for  h)uking 
to  trade  as  tho  oidy  means  of  obtaining  a  support  —  and  a  conseijuiiiit 
inoreaso  in  tlie  pri>ii(irliuHS  borne  by  mero  middlemen  to  produeurH, 
causing  increased  dcuutnd  for  sliops,  and  stores,  and  uAices,  in  grotit 
cities,  and  enabling  landlords  to  demand  the  enormous  rents  wliieh  now 
are  paid.  Tho  poor  tenant  slaves  and  starves,  and  finds  himself  at 
length  driven  to  bankruptcy  because  liis  profits,  after  liis  rent  \n  itaid, 
arc  not  enough  to  enable  him  to  feed  and  clothe  his  wife  and  (diihhcn 
— he  and  they  being  then  driven  to  peek  refuge  in  a  "  tenement  house," 
there  to  pay  a  rent  that  enables  its  rich  owner  to  double  liis  capital  iti 
almost  every  other  year.  The  rich  arc  thus  made  richer,  while  pauper- 
isni  and  crime  advance  with  the  gigantic  strides  you  have  des(!ribed, 

Is  it,  however,  in  your  city  alone  that  facts  like  these  present  thoni* 
selves  to  view  ?  That  such  is  not  the  case,  is  shown  in  the  following 
accurate  sketch  of  tlie  Philadelphia  movement  in  the  same  dlrucUuil; 
given-  a  few  days  siuce,  by  your  neighbors  of  the  Tribune: 

'•P  ertyhas  reached  bip;ber  places  in  society  than  the  habitually  dontltutP, 
Want  of  employment  with  many,  and  reduceil  wajtes  with  others,  all  Riowiiiij;  oiit 
of  the  warfare  of  the  government  on  the  industry  of  the  country,  havo  madu  lli« 
present  season  ono  of  peculiar  h.ardship  and  sufl'erin^.  Honest  labor  goon  willuuit 
its  loaf,  because  no  one  can  afford  to  employ  it.  1'er.sons  formerly  able  to  KU|ip(n't 
themselves  decently,  are  now  crowding  for  relief  to  our  benevolent  inNlitiHIniiH, 
The  visitors  of  the  latter  say  there  is  more  suffering  now  than  ever  before  known. 
Clothing,  food,  and  fuel  are  dui'y  given  in  large  amounts,  and  yet  the  cry  of  din- 
tress  continues.  The  soup-houses  have  been  compelled  to  reopen,  and  tliu  «li«» 
ritable  are  taxed  to  the  utmost.  These  suffering  thousands  are  the  viuliiiiH  of  (ho 
Bcandulous  misgovernment  which  bus  palsied  the  energies  of  so  many  braauho* 
of  industry.     They  would  gladly  earu  their  bread,  if  permitted  to  do  no," 


TIIF.IR   rAUSEM  AND    EKFECTM. 


2.1 


All  th'iH  iH  Htrictly  fruo,  iirid  It  woiiM,  jim  1  Miik,  hv.  (••nially  ho  if  nnid 
of  any  other  city  of  tlu!  I'liioii  —  tlic  wli<)l(!  incxciniiif.'  a  picture  of  en- 
forced  idloiiosH  hiioIi  iin  in  not,  at  this  inonu'ut,  to  lie  parallclt'd  in  uviy 
country  cluiining  to  rank  as  civilizt'd.  I'ass  next,  if  you  jpjca.xc,  outward 
from  our  cities,  and  look  to  the  towuH  and  villages  of  your  own  and 
Other  States  —  marking  the  fact,  that  the  {)ow(!r  of  local  eouihination  in 
fitcadily  diminishing,  am\  that  u  majority  of  them  have  eitlu-r  bceoniu 
Btationary,  or  liavo  retrograded.  Clo  almost  where  you  may,  you  will  find 
that  tho  internal  commerce  of  the  country  is  gradually  dolining  —  that 
tho  8ervice8  of  mechanics  are  meeting  less  and  less  demand  —  that  the 
dcpcndonco  on  great  cities  is  increasing  in  the  same  proportion  that  thoso 
cities  aro  themselves  heeoming  more  dependent  upon  Liverpool  and 
Manchester— and  that,  as  u  necessary  consecpienec,  paup<'rism  and  crime 
are  everywhere  assuming  ]»roportions  so  gigantic  us  well  to  warrant  you 
in  tho  assertion  that  their  growth  is  now  so  vigorous  as  to  hid  delianee  to 
"all  half  measures  of  eradication." 

How  may  they  bo  eradicated  1'  This  is  a  great  (juestiun  ;  but  to  find 
the  answer  to  it,  wo  must  first  incjulrc  to  what  it  is  that  surh  a  growth 
in  due.  ])oing  this,  we  find  that  the  I'acts  of  the  pre.^ent  day  are  in 
strict  accordance  with  those  ob.served  in  the  years  which  iollowed  the 
terrible  free-trade  crises  of  181.S-20  and  18;]7— 10,  as  \vell  as  with  tliose 
observed  in  Ireland,  India,  and  all  other  countries  subjeet  to  the  liritish 
free-trade  system.  Jjooking  nisxt  to  the  periods  which  Iollowed  the  pas- 
sage of  the  protective  acts  of  l!^2S  and  1H42,  we  find  directly  the  reverse 
of  this  —  pauperism  then  steadily  declining,  and  the  morals  of  the  com- 
munity improving  as  the  societary  movement  became  more  regular.  Turn- 
ing thence  toward  Northern  and  Central  Europe  —  toward  that  portion 
of  tho  Kastern  world  which  steadily  resists  the  exhaustive  British  sys- 
tem—  we  find  phenomena  corresponding  precisely  with  tluLSC  ob.served 
in  our  own  protective  periods — the  demand  for  human  service  becoming 
more  and  more  regular  in  France  and  (lermany,  and  the  reward  of  labor 
growing  with  a  steadiness  that  has  rarely,  if  ever,  been  exceeded. — Such 
being  tho  facts,  Is  it  not  clear,  my  dear  sir,  that  it  is  to  the  readoption 
of  the  protective  policy  we  must  look  for  effectual  ''  measures  of  eradi- 
cation."    Believe  me,  nothing  short  of  this  will  do. 

The  readers  of  the  Journal  of  Cummrrcc  have  lately  been  assured 
"  that  our  institutions  nurture  the  evils  in  question."  Were  that  really 
the  case,  the  evil  would  be  so  radical  in  charaeter,  that  nothing  short  of 
revolution  could  produce  the  change  desired.  That,  happily,  it  is  not 
80,  you  will,  I  think,  be  well  assured,  when  you  shall  have  refiected  that 
all  our  institutions  find  their  foundation  in  local  dcvclopinoiit,  tending 
to  the  creation  of  thrivii.g  towns  and  villages  in  the  neighborhood  of 
our  vast  deposits  of  coal  and  lead,  copper,  zinc,  and  iron — there  making 
u  market  for  the  products  of  agriculture,  and  giving  occasion  to  the 
improvement  of  our  great  water  powers,  to  bo  used  in  the  conversion 
of  food  and  wool  into  cloth,  and  food,  coal,  and  ore,  into  knives  and 
axes,  steam-engines  and  railroad  bars.  —  What  now  is  the  object  for 
whose  attainment  our  people  seek  protection  ?  Is  it  nut  this  very  local- 
ization in  which  alone  our  institutions  find  their  base  'f  That  such  is  the 
case  is  beyond  all  question,  and  therefore  is  it,  that  confidence  in  those 


24 


FINANCIAL  crises; 


i 


institutions  grows  in  every  period  of  protection  —  pauperism  and  crime 
then  declinin<j;  in  their  proportions  with  each  successive  hour. 

What,  on  the  contrary,  are  the  tendencies  of  the  British  free-trade 
system  ?  Do  not,  under  it,  towns  and  villages  decline,  while  great  cities 
grow  in  size?  Under  it,  does  lot  internal  commerce  die  away?  Do  not 
crimes  become  more  frequent  and  more  severe  ?  Does  not  paralysis  take 
the  place  of  that  healthy  action  which  is  indicative  of  strong  and  vigor- 
ous life  ?  Do  not  pauperism  and  immorality  irow  with  the  growth  you 
have  so  well  described  ?  Does  not  confidence  in  the  utility  and  perma- 
nence of  our  institutions  diminish  with  each  successive  year?  To  all 
these  questions,  the  answers  must  be  in  the  affirmative — such  phenomena 
having  presented  themselves  at  the  close  of  every  free-trade  period,  and 
the  only  diflFcrence  between  the  present  and  the  past  being,  that  the 
current  one  has  been  so  much  longer,  and  that  the  disease  has,  therefore, 
become  by  far  more  virulont. 

Looking  at  all  these  facts,  is  it  not  clear,  my  dear  sir  — 

That  the  cause  of  disease  is  not  to  be  found  in  the  character  of  our 
institutions  ? 

That,  on  the  contrary,  it  is  to  be  found  in  the  pursuit  of  a  policy  that 
is  at  war  with  tho«:e  institutions,  and  threatens  their  destruction  ? 

That  the  remedy  of  which  you  are  in  search,  is  to  be  found  in  the 
readoption  of  the  policy  of  protection,  under  which  the  country  so  much 
prospered  in  the  periods  closing  with  1884  and  1847? 

That  in  default  of  the  adoption  of  this  remedy,  our  institutions  must 
decay  and  disappear  ? 

That  every  real  frit>nd  of  freedom  should  aid  in  the  effort  to  rescue 
his  countrymen  from  the  grasp  of  foreign  traders  in  which  they  are 
now  held  ? 

That  every  movement  in  that  direction  must  tend  toward  diminution 
in  the  quantity  of  wretchedness  and  crime  ?     And,  therefore, 

That  all  who  oppose  such  action  —  teaching  British  free-trade  doc- 
trines  arc  thereby  making  themselves  responsible,  before  God  and 

man,  for  the  demoralization  above  described  ? 

Repeating,  once  again,  my  offer  to  place  jour  replies  to  these  ques- 
tions within  the  reach  oi'  a  million  and  a  half  of  protectionist  readers, 


I  remain,  my  dear  sir, 


YcYj  respectfully,  your  obedient  servant, 

Henry  0.  Carey. 


W.  C.  Bryant,  Esq. 


rniLADKUUiiA,  January  31,  18G0. 


THEIR  CAUSES   AND  EFFECTS. 


20 


LETTER    SIXTH. 

Dear  Sir. — Pauperism,  slavery,  and  crime,  as  you  have  seen,  fol- 
low everywhere  in  the  train  of  the  British  free-trade  system,  of  wliioh 
you  have  been  so  long  the  earnest  advocate.  On  the  contrary,  tin  y 
diminish  everywhere,  and  at  all  periods,  when,  in  accordance  with  the 
advice  of  the  most  eminent  European  economists,  that  system  is  cftbct- 
ually  resisted.  We,  ourselves,  are  now  in  the  fourteenth  year  of  a  troo- 
trade  period  —  the  result  exhibiting;  itself,  as  you  yourself  so  recently 
have  shown,  in  a  growth  of  all  that  has  at  length  most  seriously 
alarmed  the  very  men  to  whose  unceasing  efforts  that  growth  is  due. 
That  they  should  be  so  is  not  extraordinary,  but  their  alarm  would  be 
much  increased  were  they  now  to  study  carefully  the  condition  of  affairs 
at  the  end  of  the  peaceful  and  quiet  period  of  protection  which  closed 
with  1847,  and  then  contrast  with  it  the  state  at  which  we  have  arrived 
—  following  up  the  examination  by  asking  themselves  the  question  — 
Whither  are  we  tending?  —  and  seeking  to  find  an  answer  to  it.  The 
picture  that  would  then  present  itself  to  view,  would  so  much  shock 
them,  that  they  would  shrink  back  horrified  at  the  idea  of  the  fearful 
amount  of  responsibility  they,  thus  far,  had  incurred. 

That  the  facts  are  such  as  yon  have  described  them,  cannot  be  denied. 
Do  they,  however,  flow  necessarily  from  submission  to  the  British  sys- 
tem, miscalled  by  its  advocates  the  free-trade  one — that  one  which  seeks 
to  limit  all  the  nations  of  the  world,  outside  of  England,  to  the  use  of 
the  plough  and  the  harrow,  and  to  a  single  market,  that  of  England,  for 
an  outlet  for  their  products  ?  That  they  do  so,  you  will,  I  am  sure,  be 
ready  to  admit,  after  having  reflected  that  men  become  rich,  free,  strong, 
and  moral,  in  the  ratio  of  their  power  to  associate  and  combine  together, 
and  that  the  object  of  the  British  system,  for  more  than  a  century  past, 
has  been  that  of  preventing  combination,  by  frustrating  every  attempt 
at  the  production  of  that  diversification  of  pursuits,  wiihout  which  the 
power  of  association  can  have  little  or  no  existence. 

What  was  the  system  before  the  Revolution,  and  what  wore  the  mea- 
Bures  recommended  as  being  those  most  likely  to  promote  the  retention 
of  the  colonists  in  thoir  then  existing  state  of  dependence,  are  fully 
shown  in  an  English  work  on  the  then  American  Colonies,  of  much 
ability,  published  in  London  at  the  time  when  Franklin  was  urging  upon 
his  countrymen  the  diversification  of  their  pursuits,  as  the  only  road 
towards  real  independence,  and  from  which  the  following  is  an  extract : 

"The  population,  from  being  spread  round  a  grcnt  extent  of  frdnticr,  would 
increase  without  giving;  the  least  cause  of  jealousy  to  Britain ;  land  would  not  only 
be  plentiful,  but  plentiful  where  our  people  wanted  it,  whereas,  at  present,  the 
population  of  our  colonies,  especially  the  centr;  '.  ones,  is  coniineil ;  they  have 
spread  over  all  the  space  between  the  sea  and  the  mountains,  the  consoquonce  of 
whici  .8,  that  land  is  becoming  scarce,  that  which  is  good  having  all  hvon  planted. 
The  people,  therefore,  find  themselves  too  numerous  for  the  ngricultiire,  wliich  is 
the  first  step  to  becoming  manufacturers,  that  step  Avhich  Ihitiiin  has  so  much 
reason  to  dread  " 


26 


nNANCIAL  CniSES  : 


Why,  my  dear  sir,  sliould  Britain  have  so  much  dreaded  combination 
among  her  colonial  subjects?  Why  should  she  so  sedulously  have  sought 
to  disperse  thorn  over  the  extensive  tracts  of  land  beyond  the  mountains? 
Because,  the  more  they  scattered  the  more  dependent  *hey  could  be  kept, 
and  the  more  readily  they  could  bo  compelled  to  carry  all  their  rude 
products  to  a  distant  market,  tliere  to  sell  them  so  cheaply,  v.s  we  are 
told  by  another  distinguished  British  writer,  "  that  not  cue-fourth  of 
the  product  redounded  to  their  own  profit,"  as  a  consequence  of  which 
plantation  mortgages  wore  most  abundant,  and  the  rate  of  interest  charged 
upon  them  so  very  high,  as  generally  to  eat  the  mortgagor  out  of  house 
and  home.  In  a  word,  the  system  of  that  day,  as  described  by  those 
writers,  was  almost  precisely  that  of  the  present  hour.  For  its  mainte- 
nance, dispersion  of  the  population  was  regarded  as  indispensable,  and 
that  it  iiii"^^ht  be  attained,  the  course  of  action  here  described  was  re- 
couiniended : 

«« Nothing  can  therefore  be  more  politic  than  to  provide  a  superabundance  of 
colonics,  .  take  ofl'  all  those  people  that  find  a  want  of  land  in  our  old  settle- 
ments •  and  it  may  not  be  one  or  two  tracts  of  country  that  will  answer  this  pur- 
pose ;  provision  should  be  made  for  the  convenience  of  some,  tlie  inclination  of 
others,  and  every  measure  taken  to  inform  the  people  of  the  colonies  tliat  were 
growing  too  populous,  that  land  was  plentiful  in  otlier  places,  and  granted  on  the 
easiest  terms;  and  if  such  inducements  were  not  found  sufficient  for  thinning  the 
country  considerably,  government  should  by  all  means  be  at  the  expense  of  trans- 
porting them.  Notice  should  be  given  that  sloops  would  be  always  ready  at  Fort 
Pitt,  or  as  much  higher  on  the  Ohio  as  is  navigable,  for  carrying  all  furniture 
without  expense,  to  whatever  settlement  they  chose,  on  the  Ohio  or  Mississippi. 
Such  measures,  or  similar  ones,  would  carry  off  the  surplus  of  population  in  the 
central  and  southern  colonies,  which  have  been  and  will  every  day  be  more  and 
more  the  foundation  of  manufactures." 

Having  studieJ.  ihese  recommendations  in  regard  to  the  maintenance 
of  colonial  dependence,  I  will  ask  you  next  to  look  with  me  into  the 
working  of  the  British  free-trade  system,  and  satisfy  yourself  that  its 
advocates  have  been  mere  instruments  of  our  fouign  masters  —  closing 
our  mills,  furnaces,  and  factories,  retarding  the  development  of  our 
great  mineral  treasures,  preventing  the  utilization  of  our  vast  water 
powers,  and  in  this  manner  driving  our  people  to  the  West,  in  strict 
accordance  with  the  orders  of  those  British  traders  against  whom  our 
predecessors  made  the  Revolution. 

In  1815,  the  receipts  from  sales  of  public  lands  amounted  to  $1,287,000 
This  gives  a  measure  of  the  then  existing  tendency  toward  dispersion. 
Five  years  later,  when  the  free-trade  system  had  paralyzed  the  industry 
of  the  country,  they  had  risen  to  $3,274,000  —  the  customs  revenue  of 
the  same  year  yielding  more  than  $20,000,000.  The  government  had 
seemed  to  be  rich,  and  for  the  reason  that  it  was  "burning  the  candle  at 
both  ends"  —  paralyzing  domestic  commerce,  and  driving  into  the  wil- 
derness the  people  to  whose  eflForts  it  had  been  used  to  look  for  its  sup- 
port. Free  trade,  excitement  having  been  followed  by  paralysis,  we  find 
the  customs  revenue  to  have  fallen,  in  1821,  to  $13,000,000  —  the  land 
revenue  at  the  same  time  gradually  declining  until,  in  1823,  it  stood  at 
less  than  a  single  million.  As  a  conse(|uencc,  we  see  the  treasury  to 
have  been  so  much  embarrassed  as  to  be  under  the  necessity  of  con- 
tracting loans,  in  the  period  from  1819  to  1824,  to  the  extent  of  no 


THEIR  CAUSES  AND   EFFECTS. 


27 


less  than  $16,000,000.  tVs  usual,  liere  and  everywhere,  poverty,  dis- 
tress, and  ('"ibt,  to  both  the  people  and  the  government,  had  followed  in 
the  train  of  the  teachings  of  the  men  who  had  desired  a  readoption  of 
that  dispersive  policy  recommended  by  British  writers,  as  a  means  of 
prolonging  colonial  dependence. 

Turn  now,  if  you  please,  my  dear  sir,  to  the  picture  presented  by  the 
protective  tariff  of  1828,  and  mark  the  steadiness  of  customs  receipts, 
and  the  gentle  and  quiet  growth  of  the  receipts  from  lauds,  as  follows : 

Customs.  Land  Sales.  Total. 

1829  $22,681,000  $1,517,000  $24,198,000 

18S0  21,920,000  2,329,000  24,249,000 

1831   21,204,000  3,210,000  27,414,000 

1832 28,405,000  2.fi23,000  81,068,000 

1833  29,032,000  3,967,000  32,999,000 

In  this  period,  every  man  could  sell  his  labor,  and  could  therefore 
purchase  the  products  yielded  to  the  labor  of  others.  Every  one  being 
thus  enabled  to  contribute  his^ehare  to  the  support  of  the  government, 
the  revenue  bad  become  so  large  and  steady  that  the  national  debt  was 
then  extinguished. 

Pass  on  now,  if  you  please,  to  the  time  when  the  approaching  annihi- 
lation of  protection  had  stopped  the  building  of  mills  and  the  opening 
of  mines,  and  had  recommenced  to  compel  our  people  to  scatter  them- 
selves over  the  great  West,  and  find  the  following  figures : 

Customs.  Land.  Total. 

1835  $19,391,000  $14,767,000  $34,148,000 

1836  23,409,000  24,877,000  49,286,000 

Once  again,  the  government  was  "burning  the  candle  at  both  ends" 
—annihilating  the  power  of  combination,  and  thus  diminishing  the  pro- 
ductive forces  of  the  country.  As  before,  it  fancied  itself  rich,  and  acted 
accordingly — the  expenditure  of  this  period  almost  trebling  that  of  Mr. 
Adams's  administration,  then  but  a  few  years  past.  As  a  consequence, 
bankruptcy  of  the  people  and  of  the  banks  was  followed  by  disappear- 
ance of  the  power  to  contribute  to  the  support  of  government,  the  cus- 
toms duties  of  1841  having  but  little  exceeded  $14,000,000,  and  the 
land  sales  having  fallen  to  $1,300,000  —  giving  a  total  of  less  than 
$16,000,000,  not  even  one-third  of  that  of  1836,  Such  having  been 
the  case,  need  we  wonder  that  the  poverty  of  the  government  should 
have  exhibited  itself  in  the  form  of  irredeemable  notes,  and  in  vain 
efforts  to  effect  a  loan  in  any  part  of  Europe.  Having  destroyed  our 
domestic  commerce,  and  thus  greatly  diminished  the  productive  power 
of  the  country,  our  foreign  free-trade  friends  now  turned  their  bucks 
upon  us  —  denouncing  our  whole  people  as  rogues  and  swindlers. 

Once  again,  in  1842,  we  find  the  readoption  of  the  policy  of  resistance 
to  British  domination,  and  once  again  we  meet  the  tranquillity  and  peace 
of  the  period  which  found  its  close  in  1834,  as  is  shown  in  the  following 
figures : 

Customs.  Land.  Total. 

1843-4  $26,183,000  $2,059,000  $28,242,000 

1844-5  27,508.000  2,077,000  20,585,000 

1845-6  26,712,000  2,694,000  29,406,000 

1840-7  23,747,000  2,498,000  20,245,000 


28 


FINANCIAL   crises; 


i-i 


m- 


I' 


Again,  as  always  under  protection,  there  was  economy  in  the  adminis< 
tration  of  the  government.  Again,  the  necessity  for  contracting  loans 
had  passed  away.  Again,  too,  the  foreign  debt  of  the  free-trade  period 
was  being  diminished;  and  why?  Because,  once  again,  that  colonial 
policy  which  looked  to  the  dispersion  of  our  people  had  been  rejected. 

Not  content  with  the  lesson  that  had  thus  been  taught,  the  protective 
policy  was  again  abandoned,  and  once  again  we  find  the  colonial  system 
re-established,  the  results  exhibiting  themselves  in  the  following  remark- 
able figures,  indicating  the  extent  to  which  the  government  has  recently 
been  repeating  the  experiment  of  "  burning  the  candle  at  both  ends  " : 

Customs.  Land  Sales.  Total. 

18.53-4  $04,224,000  $8,470,000  $72,004,000 

18.54-5  J^:^ ,02.5,000  11,497,000  64,522,000 

1855-6  64,;  "^000  8,917,009  72,939,000 

As  before,  in  every  free-trade  period,  the  government  wad  becoming 
daily  richer,  while  the  productive  power^iras  declining  from  day  to  day. 
Expenditures,  of  course,  increased  —  having  reached,  for  those  three 
years,  exclusive  of  interest  upon  a  large  public  debt,  an  average  of 
$56,000,000,  or  nearly  five  times  more  than  they  had  been  thirty  years 
before. 

Having  thus  laid  the  foundation  for  a  crisis,  need  we  wonder  that  that 
crisis  came,  leaving  the  government,  but  recently  so  rich,  in  a  state  of 
actual  bankruptcy,  and  wholly  unable  to  meet  the  demands  upon  it? 
Certainly  not.  It  was  precisely  what  has  happened  in  every  British  free- 
trade  country  of  the  world,  aud  in  every  free-trade  period  of  our  own. 
In  each  and  every  one,  our  people  had  been  driven  out  from  the  older 
States,  and  the  government  had  been  enabled  to  take  from  them,  in  pay- 
ment for  public  lands,  the  mass  of  their  little  capitals,  leaving  them  to 
borrow  at  three,  four,  or  five  per  cent,  j7e>'  month,  of  the  wealthy  capi- 
talist, all  that  had  been  required  to  pay  for  their  impi-ovements  —  and 
finally  leaving  them  in  the  hands  of  the  sheriff",  under  whose  hammer 
their  property  had  sold  so  cheaply  as  almost  to  forbid  the  purchase  of 
lands  that  were  as  yet  public  and  unimproved.  The  receipts  from  that 
source  are  now  estimated  at  $2,000,000,  and  thus  have  we  returned  to  a 
point  that  is  really  lower — our  numbers  being  considered — than  that  at 
which  we  arrived  at  the  close  of  the  British  free-trade  speculations  of 
1817-lS  and  1836-39. 

Looking  at  all  these  facta,  my  dear  sir,  is  it  not  clear — 

That  the  system  which  you  advocato,  ar  i  which  has  usurped  the  free- 
trade  name,  is  but  a  return  to  that  colonial  one  described  in  the  passages 
above  submitted  for  your  perusal  ? 

That  it  has  for  its  object  the  destruction  of  the  power  of  combination, 
and  consequent  diminution  of  the  ability  to  produce  commodities  in 
which  to  trade  ? 

That,  as  a  necessary  consequence,  it  tends  to  produce  a  growing  de- 
pendence of  both  the  people  and  the  State  upon  foreign  traders  and 
foreign  bankers? 

That  to  its  present  long  continuance  is  due  the  fact,  that  British  jour- 
nalists now  speculate  upon  "  the  recovery  of  that  influcnc  ^  which  eighty 
years  ago  England  was  supposed  to  have  lost"  ? 


TIIETtt  CAUSES  AND  EFFECTS.  $$ 

That  tlio  tiimU-noy  toward  recolonization  is  growing  with  every  hour, 
and  that  with  mah  Hiicoessive  one,  we  are  more  and  more  becoming 
more  toolH  in  tho  hntuU  of  British  traders?  ** 

That,  tljordlon!,  it  in  the  duty  of  every  friend  of  freedom  and  inde- 
pondoiico  to  lend  IiIh  aid  to  the  re-establishment  of  that  protective  sys- 
tem under  which  tlio  country  so  much  advanced  in  prosperity  and  power, 
in  the  poriodH  which  closed  in  181G,  1834,  and  1847? 

llcpctttinj;  tlu!  ]ir()poMitiijn,  already  so  often  made,  to  have  your  answers 
to  these  (jucHtidiiH  pliieed  before  a  million  and  a  half  of  protectionist 
readers,  1  rcniuin,  my  dear  sir,  with  great  respect, 

Your  obedient  servant, 

Henuy  C.  Carey. 

W.  C.  lijlVANT,  Khq. 

PHiLADELrniA,  February  7,  186flt 


80 


FINANCIAL  crises: 


LETTER    SEVENTH. 

Dear  Sir. — The  ossontial  ohjoct  of  the  British  system,  as  you 
have  already  soon,  is  the  suppression,  in  every  country  of  the  world, 
outside  of  Britain,  of  thiit  diversity  of  human  emjdoyments,  without 
which  there  can  be  made  no  single  step  toward  freedom.  The  more 
that  objcict  can  be  achieved,  the  more  must  other  nations  be  compelled 
to  export  their  products,  and  in  their  rudest  shape,  to  Britain  —  doing 
go  in  direct  opposition  to  tlie  advice  of  Adam  Smith. — This  is  what  is 
called  British  free  trade,  the  base  of  which  is  found  in  that  annihilation 
of  domestic  commerce,  whose  effects  exhibit  themselves  in  the  poverty, 
wretchedness,  and  crime  of  India,  Ireland,  Turkey,  and  other  countries 
subjected  to  the  system,  all  of  which  are  so  well  reproduced  among  our- 
selves in  every  British  free  trade  period.  Ileal  freedom  of  commerce 
consists  in  going  where  you  will  —  exporting  finished  commodities  to 
every  portion  of  the  world.  Seeking  that  freedom,  the  most  eminent 
French  economists,  as  you  have  already  seen,  have  held  that  it  waa 
"only  the  accomplishment  of  a  posit'. e  duty"  for  governments  "so  to 
act  as  to  favor  the  taking  possession  of  all  the  branches  of  industry  whose 
acquisition  is  favored  by  the  nature  of  things,"  and  that  when  they  failed 
to  do  so,  they  made  "  a  great  mistake." 

In  full  accordance  with  the  idea  thus  expressed,  the  French  Govern- 
ment has  adhered  to  the  policy  of  protection  with  a  steadiness  without 
example — the  groat  result  exhibiting  itself  in  an  export  of  the  products 
of  agriculture,  in  a  finished  form,  such  as  can  nowhere  else  be  found. 
Thus  protecting  domestic  commerce,  the  government  finds  itself  repaid 
in  the  power  to  obtain  revenue  from  a  foreign  conmierce  that  has  quad- 
rupled in  the  short  space  of  thirty  years  — the  $100,000,000  of  1830 
having  been  re))laced  by  the  almost  $100,000,000  of  each  of  the  last 
three  years  —  the  population  meantime  having  remained  almost  station- 
ary. As  a  conso([uence  of  ihis  the  rewai'd  of  labor  has  much  increased, 
the  people  have  become  more  free,  and  the  State  has  grown  in  influence 
with  a  rapidity  unknown  elsewhere. 

That  it  is  to  industrial  dovelo})ment  we  are  to  look  for  the  creation  of 
a  real  agriculture,  can  now  be  no  longer  doubted — the  Emperor  having, 
in  his  rocont  letter,  told  his  finance  minister,  tliat "  witliout  a  prosperous 
industry  agriculture  itself  remains  in  its  infancy;"  that  "it  is  necessary 
to  liberate  industry  I'njin  all  internal  impedinicnts,"  and  thereby  "  im- 
prove our  agrioulturo;"  and  that  in  so  doing  the  govornmcnt  will  be 
"  creating  a  national  wealth  "  and  diftusiii";  "  comforts  anion";  the  workin":- 
classes. 

Nothing  more  accurate  than  this  could  have  been  said  by  the  great 
Colbert  himsoli^ — the  man  to  whose  labors  Franco  was  first  indebted  for 
the  relief  of  her  (lomostie  coinmorce  from  the  pressure  of  internal  restric- 
tions and  external  warfare.  Compare  it,  however,  1  pray  you,  with  our 
policy,  errunouusly  styled  the  free  trade  one,  every  portion  of  which 


1 


Til  Kin  CAUSES  AND  EFFECTS. 


31 


BCcmH  to  havo  liinl  Cor  itM  objoot  the  croatinn  of  iinpodimcnts  to  domestic 
coininereo,  nnd  tlin  Miilijii^ntion  <tf  our  fhriiiers  to  the  tyranny  of  foreign 
trudorH.  I^ook,  if  yon  |ik'fiHO,  to  tlic  nlniont  ondlcss  series  of  laws  having 
for  their  ol)j(U!t  the  eoiii|mlHory  uho  of  gold  and  silver,  in  ii  country  which 
exportH  tho  preeioiiM  inetiilM  to  HUeh  extent  as  to  have  driven  our  people, 
throughont  ii  large*  extent  of  country,  to  tho  payment  of  three,  four,  and 
fivtf  per  con*  per  mtinth,  for  the  use  of  the  small  amount  of  money 
which,  oven  iit  hucIi  rittcH,  can  bo  obtained.  Turn  next  to  tho  ,,ostagc 
law  proponed  by  your  Hoiilhern  free  trade  friends,  at  the  last  session,  by 
meanB  of  whieli  tlio  eliiirge  for  the  transmission  of  letters  was  to  be 
almost  douldcd.  Hludy  then  tho  constant  succession  of  free  trade  crises, 
by  meanH  of  whiefi  our  doniestte  commerce  has  been  so  often  paralyzed. 
Pass  on,  and  find  the  closing  of  furnaces  and  mills,  followed  by  constant 
increase  of  dilheiilty  In  the  sale  of  labor  —  constantly  growing  pauperism 
and  crime  —  and  uh  eotistant  increase  of  that  dependence  upon  foreign 
markets  which  Iium,  in  every  other  country,  been  attended  by  growth  of 
slavery  among  men,  whether  black,  brown,  or  white.  Look  where  you 
may,  von  will  Hnd  the  ftyMtem  of  which  you  have  been  the  steady  advo- 
cate, leading  to  the  ii(h)ption  of  measures  directly  opposed  to  the  teach- 
ings of  Adam  Hinlth  atid  tliosc  of  his  most  distinguished  successors, 
here  endorsed  by  LouIh  Napoleon. 

Turn  next  to  anothftr  passage  of  the  imperial  letter,  and  find  in  it 
that  ngrieultJiro  tnust  hnvj;  *'  its  share  in  the  benefits  of  tlie  institutions 
of  credit,"  and  that  the  government  must  "devote  annually  a  considerable 
sum  to  workH  of  drainago,  irrigation,  and  clearago."  Having  read  this, 
study,  if  you  jtleiiHe,  the  proceedings  of  your  free  trade  friends,  constantly 
engaged  as  they  havo  been,  in  the  effort  to  destroy  the  credit  of  banks, 
and  to  prevent  the  HubKtitution  of  paper  for  gold  —  and  thus  so  far  de- 
stroying eonfl(huic«,  that  teUH  of  millions  of  specie  arc  now  hoarded  in 
private  vunltH  by  men  who  dare  not  spend  it,  and  fear  to  lend  it  at  any 
interest  whatHOOvor, — -Turn,  thence,  to  the  condition  of  our  treasury,  and 
contrast  it  with  that  of  France  —  the  latter  proposing  to  lend  money  to 
tho  people  at  low  interest,  while  the  former  is  constantly  in  the*  market 
as  a  borrower,  antl  at  higher  rates  of  interest  than  are  paid  by  any  govern- 
ment that  claiuiH  to  rank  as  civilized. 

Pass  next  to  manufactures,  and  find  the  Emperor  telling  his  minister 
that,  '<to  oneourage  iiidnstrial  production,  he  must  liberate  from  every 
tax  all  raw  material  indispensable  to  industry,"  and  that  he  must  "  allow 
it,  exceptionally,  and  at  a  moderate  rate,  as  has  already  been  done  for 
agriculture,  the  ftinds  necessary  to  perfect  its  raw  material" — meaning 
thereby,  aw  I  nndersland  it,  further  grants  of  aid  similar  to  tho.«e  which 
have  resulted  in  improving  tho  breed  of  sheep,  and  in  giving  to  French 
agriculture  many  prodm-ts  not  native  to  the  soil,  and  yet  essential  to 
the  perfection  of  niantifactures. — Having  studied  this,  allow  me  next  to 
request  that  you  will  examine  the  teachings  of  the  author  of  the  tariff 
of  1H4(I — the  tarid'you  have  so  steadily  admired — and  find  liini  protest- 
ing against  the  inmoHition  of  "higher  duties  upon  the  manufiiotured 
fabric  than  upon  tho  agricultural  product  out  of  which  it  is  mndn." 
Examine,  then,  IiIm  taritV,  and  find  in  it  a  systematic  effort  at  the  dis- 
couragement of  iiidiiMtrial  jiroduction  by  the  imposition  of  heavy  duties 
on  the  raw  mal<  rial  of  manufactures  —  sometiiues  so  great,  even,  as  to 


FINANCIAL  crises: 


excooil  tluiso  paiil  by  tlio  finished  coininoilitios  for  the  production  of 
v/hicli  they  were  iiocdcd  to  bo  uncd.  That  done,  look  next  at  tlio  re- 
peated efforts  of  private  individuals  to  inipntve  our  breed  of  sheep,  and 
at  the  ruin  that  has  been  the  eonsofjuence  —  that  ruin  liavinj?  resulted 
neceswirily  from  cluinj^es  of  jioliey  that  liave  closed  our  factories  and 
gent  merinos  to  llic  sluuu;htcr-liousc.  Look  in  what  direction  you  may, 
you  will  lind  that,  with  the  excption  of  the  brief  and  brilliant  period 
of  the  tariff'  of  1842,  the  men  cngajjed  in  the  development  of  our  f>reat 
mineral  treasures,  and  those  engaged  in  introducing,  extending,  and  per- 
i'eeting  works  of  CDUversion,  and  thereby  giving  the  farmer  a  market 
ibr  his  products,  have  been  regarded  as  enemies,  deserving  only  of  the 
hatred  of  the  government;  as  men  for  the  accomplishment  of  whose 
ruin  I'raud  and  falsehood  might  justly  be  resorted  to  —  the  holiness  of 
the  end  sanctifying  the  employment  of  any  means  that  might  be  used. 

Adopting  these  ideas,  the  Kmperor  assures  his  minister  that  he  will 
find  in  them  the  road  toward  real  freedom  of  trade  —  the  great  exten- 
sion of  commerce  producing  a  necessity  for  "  successive  reductions  of  the 
duty  on  articles  of  great  consumption,  as  also  the  substitution  of  pro- 
tecting duties  ibr  the  prohibitive  system  which  limits  our  commercial 
relations." — Having  read  this,  do  me  the  favor  to  turn  to  the  period  of 
the  jtrotcetive  tariff'  of  ISliS,  and  find  there  precisely  the  state  of  things 
here  described  —  the  great  increase  of  revenue  having  then  produced  a 
necessity  for  abo]isliii;g  the  duties  that  had  always  thus  far  been  paid 
})y  tea  and  cttff'ee.  Look,  next,  to  the  working  of  that  dispersive  system, 
which  scatters  our  population  over  the  continent,  and  destroys  the  power 
of  combination  —  at  one  moment  filling  the  treasury  to  repletion  by 
means  of  custom-house  receipts  and  sales  of  public  lands,  and  then 
leaving  it  bankrupt,  to  seek,  as  was  done  in  1842,  and  is  now  being 
done,  for  loans  abroad,  to  keep  the  wacels  of  government  in  motion  until 
the  tariff"  can  be  raised. 

The  policy  of  the  French  Government  was  accurately  defined,  some 
three  or  four  years  since,  by  the  President  of  the  Council,  and  there  is 
nothing  in  the  Emperor's  letter  that  is  not  in  strict  accordance  with  the 
determination  then  expressed,  as  follows : 

"  The  Government  formnlly  rejects  tlic  principle  of  free  trade,  as  incompatible 
with  tlie  inilepcnJenco  and  sccmity  of  a  great  nation,  and  as  destructive  of  her 
noblest  manufactures.  No  doubt,  our  customs-tariffs  contain  useless  and  anti- 
quated prohibitions,  and  wo  thinli  tliey  must  bo  removed.  Protection,  however, 
is  necessary  to  our  manufactures.  This  protection  must  not  be  blind,  unchange- 
able, or  excessive ;  but  the  principle  of  it  must  be  firmly  maintaiucd." 

We  are  told,  however,  that  a  treaty  has  been  signed,  in  which  there 
are  great  advances  toward  freedom  of  trade.  If  so,  it  does  but  prove 
the  perfect  accuracy  of  M.  Chevalier,  who  is  said  to  have  been  the 
French  negociator,  in  regarding  protection  of  the  domestic  commerce  as 
the  real  and  certain  mode  of  reaching  freedom  of  intercourse  with  foreign 
nations.  "  In  every  country,"  as  he  has  told  his  readers,  "  there  arises 
a  necessity  for  acclimating  among  its  people  the  principal  branches  of 
industry" — agriculture  alone  becoming  insufficient.  "Every  commu- 
nity, considerable  in  numbers,  and  occupying  an  extensive  territory," 
is  therefore,  as  he  thinks,  "  v.ell  insjiired,  when  seeing  to  the  establish- 


THKia  CAUSES  AND  EFFECTS. 


83 


ment,  among  its  members,  of  diversity  in  tlie  modes  of  cniploymoiit. 
From  the  moment  that  it  approaches  maturity,  it  should  seek  to  prepare 
itsolf  therefor,  and  when  it  fails  to  do  so,  it  makes  a  great  mistake." 
This  "  combination  of  varied  effort,"  as  ho  continues,  "  is  not  only  pro- 
motive of  general  prosperity,  but  it  is  the  condition  of  national  proj^ress." 
Elsewhere,  ho  says,  that  "  governments  arc,  in  effect,  the  personification 
of  nations,  and  it  is  required  that  they  should  exercise  their  influence  in 
the  direction  indicated  by  tho  general  interest,  properly  studied  and 
carefully  appreciated."  Therefore  docs  he  "regard  a.s  excellent,  tho 
desire  of  some  of  the  most  eminent  men  of  the  principal  nations  of 
Europe  to  establish  around  them  tho  various  branches  of  manufactures." 

Such  being  the  latest  views  of  tho  present  leading  free-trade  writer 
of  France,  we  may,  I  think,  feel  quite  assured  that  what  ho  may  now 
liave  done,  is  only  what  he  has  regarded  as  warranted  by  the  advanced 
position  occupied  by  French  manufactures  —  that  position  having  been 
attained  by  means  of  a  steady  pursuit  of  the  protective  policy.  It  in 
the  point  at  which  we  have  ourselves  arrived  in  reference  to  every 
branch  of  manufacture  that  has  found  itself  efficiently  protected  in  tlic 
domestic  market,  whether  by  the  particular  circumstances  of  the  case, 
or  by  aid  of  revenue  laws.  More  steadily  than  to  any  other,  was  protec- 
tion given  to  the  production  of  coarse  cottons,  and  hence  it  is,  that  we 
now  export  them.  Tho  newspaper  is  protected  by  locality,  and  that 
protection  is  absolute  and  complete ;  and  hence  it  i .,  that  we  have  now 
the  cheapest  journals  in  the  world.  The  piano  manufacture  is  protected 
by  climate;  and  therefore  it  is,  that  it  has  attained  a  development  ex- 
ceeding that  of  any  other  country.  Had  iron  been  as  well  protected, 
our  annual  product  would  count  by  millions  of  tons,  and  we  should  be 
now  exporting,  in  tl'o  forms  of  iron,  and  manufactures  of  iron,  a  quan- 
tity of  food  twico  greater  than  that  we  send  to  Europe.  All  our  expe- 
rience shows,  that  tho  more  perfect  the  security  of  the  manufacturer  in 
the  domestic  market,  the  greater  is  the  tendency  to  that  increase  of 
competition  needed  for  enabling  us  soon  to  commence  the  work  of  sup- 
plying the  exterior  world. 

In  your  notice  of  the  changes  now  proposed  in  the  French  commercial 
system,  you  speak  in  terms  of  high  approval  of  Mons.  Chevalier,  as  a 
"  zealous  adversary  of  commercial  restrictions,"  but  have  you  ever,  my 
dear  sir,  taught  the  doctrines  of  the  teacher  of  whom  you  now  so  much 
approve  ?     Have  you  ever  told  your  readers, — 

That  "every  community  is  well-inspired  when  seeing  to  the  establi.-^h- 
ment  among  its  membcns,  of  diversity  in  the  modes  of  employment '":' 

That  "  combination  of  varied  effort  is  the  condition  of  national  pro- 


"  9 


gress 

That  "  every  nation,  therefore,  owes  it  to  itself  to  seek  the  establish- 
ment i>f  diversification  in  the  pursuits  of  its  people,  as  (jlermany  and 
England  have  already  done  in  regard  to  cottons  and  wt)ollens,  and  as 
France  has  done  in  reference  to  so  many,  and  so  widely-different  kinds 
of  manufacturing  industry"? 

That  "governments  are  in  effect, the  personification  of  nations,  and 
should  exercise  their  influence  in  the  direction  of  the  general  interest, 
properly  studied  and  fully  appreciated"!''     And,  therefore 

That  "  it  is  only  the  accompli.^bmcnt  of  a  positive  duty  so  to  act,  at 
3 


34 


FINANCIAL  crises: 


each  epoch  In  the  pro^jross  of  a  niition,  as  to  favor  the  takiii*^  posscHsion 
of  all  the  branches  of  industry  wliosc  accjuiwitiou  is  authorized  by  the 
nature  of  things"? 

Unhappily,  such  have  not  been  the  teachings  of  the  Poxt.  Had  they 
been  yuch  —  had  your  journal  sustained  the  pulicy  advocated  by  JMoiis. 
(Jhevalier,  as  hero  established  at  the  date  of  the  fearful  tinancial  crisis 
of  1842,  should  wc  not,  even  at  this  time,  have  been  far  advanced  toward 
that  position  in  which  wc  could  feel  tliat  protection  would  cease  to  bo 
required  ?  Unfortunately,  it  has  taught  the  reverse  of  this  —  the  results 
exhibiting  themselves  in  a  constant  succession  of  financial  crises,  iind 
paralyses  of  the  most  fearful  kind  —  in  repeated  bankruptcies  of  tho 
treasury,  of  banks,  railroad  companies,  and  merchants  —  in  an  almost 
entire  destruction  of  confidence  —  in  the  subjugation  of  tho  poor  bor- 
rower to  the  rich  money-lender,  to  an  extent  unparalleled  in  any  civi- 
lized country  of  the  world  —  and  in  a  growth  of  pauperism,  slavery,  and 
crime,  that  must  be  arrested  if  wc  would  not  see  a  perfection  of  anarchy 
established  as  being  the  condition  of  our  national  existence. 

Had  you  and  others  taught  the  doctrines  of  M.  Chevalier,  would  such 
be  now  the  state  of  things  in  a  country  so  richly  cndowd  by  nature  as 
our  own  ? 

Not  having  taught  them,  and  sucli  having  been  the  results  of  your 
past  teachings,  is  it  not  now  your  duty,  as  a  man,  as  a  lover  of  liberty, 
and  as  a  Christian,  to  study  anew  the  doctrines  of  tho  economist  you 
have  so  much  commended,  and  satisfy  yourself  that  you  have  been 
steadily  advocating  the  extension  of  slavery  while  desiring  to  be  tho 
advocate  of  freedom? 

Hoping  that  you  may  conclude  to  furnisl  answers  to  these  questions, 
and  reiterating  the  assurance  that  they  shall  have  the  largest  circulation 
aiMong  the  advocates  of  protection,  1  remain,  my  dear  sir, 

Yours,  very  truly, 

Henry  C.  Carey. 
W.  C.  Bbyant,  Esq. 

PiiiLADELrniA,  February  14,  1860. 


,ri 


TIIKIK   CALbt!"    AM>    I-IHICTS. 


35 


LETTER    EIGHTH. 

Pkar  Sin,  —  Fur  (Ik^  tnaititciianco  of  {'(ilniuMl  (](>pon(l(iioo,  nnd  for 
the  periK'tuatioii  ol" puwor  to  coiufn!!  tlio CDlcmists  to  nmko  fluir  rxcliaiiui'rt 
in  a  fovi'ijin  iiinrkct  f'nmi  wliich  tlicy  wurc  allowed  to  ciirry  away  I'Ut  oiu'- 
Iburth  (if  tlu!  ival  ymIuo  of  their  jirodiiets,  it  vas,  as  yuu  have  already 
focn,  held  that  they  .should  ho  led  to  disperse  themselves  tliroiiuhout  tho 
"West — thereby  aliiinst  aniiihilatiiiL'  that  power  of  assoeiatioii  wliieli,  as 
then  was  feared,  nii^lit  leat'  to  such  increase  of  wealth  and  streiij^th  n.s 
would  forward  tho  cause  of  indopcndenco.  For  the  acconipll-lmient  of 
that  groat  object,  the  aid  of  <;overnnient  was  then  invoked  —  its  help 
being  needed  lor  providing  lands  and  means  of  transjiortation.  Since 
then,  the  British  free  trade  system  lias  been  cmjiloyed  to  do  tin;  work, 
its  mode  of  action  being  that  one  so  well  described  in  a  Parliamentary 
document  now  but  a  few  years  old,  the  Jbllowing  extract  from  which  is 
here  submitted  for  your  perusal : 

"  The  laboring  classes  generally,  in  tlie  manufacturing  districts  of  this  country, 
iinil  especially  in  tlio  iron  and  comI  districts,  are  vciy  little  aw.nro  of  the  cNtont  to 
which  they  are  often  iiulebtcd  for  their  l)f;iiig  eaiiiloycil  at  all  to  tlie  iimiienso 
losses  which  tlieir  cniiiloycrs  voltiiitarily  incur  in  hml  times,  in  order  to  thslroy 
foreign  conipeliti"n,  and  to  ijain  ami  keep  posnes/iion  of  forfiyn  markets.  Aallieiitio 
instances  are  well  known  of  employers  iinviiig  in  siioh  times  carried  on  their  works 
at  a  loss  amounting  in  the  aggregiite  to  three  or  four  hundred  thousand  jionnds  in 
the  course  of  three  or  four  years.  If  tho  efforts  of  those  who  oiicournge  the  com- 
binations to  restrict  tho  amoinit  of  labor  and  to  produce  strikes  were  to  bo  suc- 
cessful for  any  length  of  time,  the  great  accumulations  of  capital  could  no  longer 
bo  made  which  enable  a  few  of  the  iiKml  n-falthy  capitalists  to  overwhelm  all  foreign 
competiiion  in  times  of  great  depression,  and  thus  to  clear  the  way  for  tho  ivhule  trade 
to  Step  in  when  prices  revive,  nnd  to  carry  on  a  great  business  before  foreign 
capital  ■  in  again  accumulate  to  such  an  extent  as  to  bo  able  to  establish  a  com- 
petition in  prices  with  any  chance  of  success.  The  large  capitals  of  this  country 
are  the  great  instruments  of  tvarfure  against  the  compciing  capital  of  foreign  cotintries, 
and  are  the  most  essential  instruments  now  remaining  by  which  our  manufaeturuig 
supremacy  can  be  niaintaineil ;  the  other  elements  —  cheap  lalior,  abundance  of 
raw  materials,  means  of  communication,  and  skilled  labor — being  rapidly  iu  p\'Q. 
cess  of  being  eijuclized." 

Tho  system  here  so  admirably  described,  is  very  properly  charactonzed 
as  being  a  "  warfare ;"  and  it  nniy  now  be  proper  to  inquire- for  what 
purposes,  and  against  wdiom,  it  is  wagcHl.  It  is  a  war,  as  you  see,  my 
dear  sir,  for  cheapening  all  the  cominodities  we  have  to  sell,  labor  and 
raw  materials — being  precisely  the  object  sought  to  be  accomplished  by 
that  "Mercantile  System,"  whose  error  was  so  well  exposed  in  tlio 
Wealth  of  JVatiuiix.  It  is  a  war  for  compelling  tho  people  of  all  other  lands 
to  confine  themselves  to  agriculture  —  for  preventing  the  divcrsilieation 
of  employments  in  other  countries  —  for  retarding  tho  development  f>f 
intellect  —  for  palsying  every  movement,  elsewhere,  looking  to  the  utili- 
zation of  the  metallic  treasures  of  the  earth — for  increasing  the  dithculty 
of  obtaining  iron — for  diiuiniiihiug  the  dcnumd  for  labor — for  doing  all 


fiO 


riNANTUT,  cnisEH: 


tlioso  thing's  at.  homo  and  al>roa«l  —  and  for,  in  tliis  manner,  Hiilijrcliii;^ 
all  the  tnrMicrs  and  {dantiMS  ol'  the  wurld  tu  the  dumiiiation  nl'  ihii 
iiiiMinractun'rH  of  Britain. 

How  «nir  govtrnuii'nt  co-oju'ratci^  in  this  watTaro  upiin  its  iicoph*,  iinrl 
in  tlio  jiniinntion  ui'  tlic  great  work  of  reeolnni/atinn,  will  readily',  my 
dear  sir,  l)i>  undersludd  hy  all  who  .shall  study  the  British  [jreseriptioii 
given  in  a  former  letter,  and  shall  then  eom[»arc  it  with  the  t'oin>i)  i)f 
aetion  here,  under  your  advice,  so  steadily  jiursued  —  exiiemling,  an  wo 
have  done,  and  now  are  seekin;;'  to  do,  enormous  sums,  and  even  carrying 
on  distant  wars,  for  the  ae(|ui>ition  of  further  territory  —  making  largti 
grants  of  land  for  facilitating  the  construction  of  roatls  and  the  iiiH|)i'i'. 
sioii  of  our  peo)ili' — forcing  millions  of  acres  ujion  lln;  markt't,  and  then 
rejoicing  over  the  receipts,  as  if  they  furnislu'd  evidence  ul'  increuhing 
Rtrength,  and  not  of  growing  weakness  —  wasting  the  jiroceeds  in  polill- 
cal  johs  of  the  most  disgraceful  kind,  and  in  this  manner  produeing 
financial  crises  that  close  our  mines,  furnaces,  and  mills,  and  drivti  our 
people  to  seek  a  refuge  in  the  wilderness,  there  to  ])ay  the  speenlalor 
trehio  price  for  land  —  and  thus  enahling  liim  to  demand  three,  lour, 
or  five  ]ier  cent  /nr  mimth,  for  tlie  use  of  Honie  small  amount  of 
ca])ital  to  aid  in  clearing  the  land  thus  purchased,  and  in  erecting  thn 
little  dwelling. — The  house  huilt,  and  the  fiirm  commeneifd,  next  eonicH 
the  sheriff,  aiul  hy  his  aid  the  poor  colonist  is  now  driven  to  seiik  ii  ru'W 
refuge  in  some  yet  mure  distant  territory  —  in  full  neeordaneu  with  tho 
desires  of  those  of  our  free  trade  friends  abroad,  who  Heu  in  tivery 
attempt  at  combination  a  stc}»  toward  manufactures  —  "  that  «tep  whieli 
Britain  has  so  mueli  cause  to  dread." 

That  such  are  the  facts  presented  by  our  records  cannot  ho  denied. 
Having  .studied  them  with  the  attention  tlicy  demand,  you  will,  my  dear 
sir,  bo  in  a  position  to  answer  to  yourself,  even  if  not  to  me,  tho  (jmiHtioii 

—  Poos  the  history  of  tho  world,  in  any  of  its  pages,  exhibit  wvidencu 
of  tlic  existence  elsewhere  of  .so  powerful  a  combination  I'or  tho  pro- 
motion  of  that  pauperism  and  crime,  whose  cxtraordimiry  growtji  you 
have  so  well  described?  So  far  as  my  knowledge  of  liistory  cxtendn,  it 
warrants  me  in  saying,  that  no  such  evidence  can  be  presented. 

Tho  poor  colonist,  thus  driven  out,  .suffers  under  a  tax  for  tranHporlii- 
tion  that,  if  continued,  must  for  ever  keep  him  poor.  His  need  fop 
better  roads  is  great,  but  of  power  to  assist  himself  ho  has  nontt  what- 
ever.    His  distant  masters  may,  perhaps,  be  induced  to  grant  him  help 

—  knowing,  as  they  ilo,  that  each  new  road  will  act  as  a  feeder  of  their 
coffers,  while  aiding  in  the  destruction  of  tho  powers  >i.'  the  soil,  in  llin 
further  scattering  of  their  subjects,  and  in  rnorc  firmly  establishing  their 
own  security  against  the  adoption  of  any  measures  tending  to  I  he  pro- 
motion of  industrial  indeiicndeiice.  liands  are  now  mortgaged,  and  nl 
enormous  rates  of  interest,  as  the  only  mode  of  obtaining  tho  nieaiirt 
with  which  to  commence  the  road.  The  work  half  made,  it  becomes  next 
needful  to  raise  the  means  with  which  to  finish  it,  and  bonds  urn  ntiw 
created,  bearing  six,  eight,  or  ten  per  cent  interest,  to  bo  given  at) 
enormous  discounts,  in  exchange  for  iron  so  poor  in  ouality  that  it. 
would  find  a  market  nowhere  else  —  its  wear  and  tear  being  such  uh 
must  prove  destructive  to  its  unhappy  purcha.scr.  Under  such  eirciim- 
stanccs  the  road  fails  to  pay,  and  it  passes  into  the  hands  of  mortj^ayueM, 


TIIKia  I'AUSKM   AND    EFFECTS. 


31 


loavlii;:  tluwo  liy  whom  tlio  work  was  HtarN-il,  poonT  tlitui  iHsfore  —  tlicir 
lands  bfiii^  ht-avily  inortiramMl,  and  tlicy  thciiisclvt's  btinjr  at  last  driven 
out  of  hoiisj>  and  lioinc.  Smli  is  (lie  hi^tury  ol"  most  of  tlic  |>itsui)s  win) 
have  t'oiitrihuti'd  toward  tho  oonimcnci'mcntH  of  the  road  and  ciinal 
improvements  of  wliieli  we  so  niiieh  boust,  and  such  the  liistory  ol' 
the  roads  themselves  —  '"leli  and  every  financial  crisis  caiisini,'  riiilhcr 
iilisiirption  of  American  .ailroad  property  hy  Knj^lish  b(»ndhi>lders,  as 
has  been  already  done  iti  reference  to  the  Keading,  Krie,  und  so  many 
other  roatls. 

Must  this  cojitinuo  to  bo  so?  Tt  must,  and  for  thn  reason,  that  our 
whole  policy  teiwls  toward  the  annihilation  of  local  action  and  domestic! 
coiiimerce — that  commerce  in  the  abst;ncc  cd"  which  railroads  can  never 
be  made  to  pay  interest  on  the  debts  to  tho  contraction  of  which  their 
owners  have  been  driven.  The  f^reatt'r  their  dependence  ujioii  distant 
trade,  the  more  imj)erativo  becomes,  from  day  to  day,  the  necessity  for 
fi^htinj;  for  it  —  for  adopting  measures  tendinis' to  the  further  destruc- 
tion of  local  traihc  —  and  i'or  thus  rciideriiii;  more  and  mere  certain  tho 
ultimate  ruin  of  nearly  every  railroad  company  of  tho  I'nion.  How  is 
it  with  yourselves  —  with  the  people  of  yuur  Slate?  ]5ut  u  short  time 
eince,  wo  were  assured  that  a  barrel  cd'  flour  could  bo  transported  to  ynur 
city  from  Kuchestcr  at  less  cost  than  from  I'tica  —  from  Huflalo  more 
cheaply  than  from  l{ochcster  —  from  Cleveland  for  less  than  from 
Uufl'ulo — and  from  Chicago  more  cheaply  than  from  Cleveland  —  your 
railroad  cimipanies  thus  ottering  large  bounties  on  the  abandonment  of 
tho  soil  of  tho  State,  and  thereby  aiding  our  foreign  masters  in  the  ac- 
complishment of  tho  dispersion  of  our  people.  So  is  it  in  this  State  of 
1*0*  isylvania  —  through  freight  being  carried  at  less  than  cost,  while 
don.ostie  comnuTce  is  taxed  for  the  payment  of  losses,  interest,  salaries, 
mid  dividentls. — In  all  this  there  is  a  tyranny  of  trade  that  has  at  length 
become  so  entirely  insupportable,  that  the  farmers  of  tho  older  States 
are  now  clamorous  for  measures  of  relief —  urging  upon  their  rc- 
ppective  legislatures  the  adoption  of  laws  in  virtue  of  which  they  shall 
be  relieved  from  a  tax  of  transportation  that  is  destroying  the  value  ol' 
their  land  and  labor,  and  that  must  result  in  the  cripi)ling  ol'  all  tho 
Atlantic  States,  as  well  as  of  some  of  tho  older  of  their  Western 
neighbors. 

To  such  demand  on  tho  part  of  yfuir  farmers,  you,  however,  re)i1y, 
that  it  would  be  "  legislation  against  trade"  —  that '•  nothing  could  Le 
more  impolitic  than  this  process"  —  that 


"The  citizen'^  of  T^ultiniore  nml  rhiln>lclpliia,  if  llioy  .<hoiiM  think  it  dernrous 
and  pCilitic  to  do  f^iich  a  tiling,  might  well  ijuh.s  a  piiliiic  vote  of  thaiili-i  to  tiio 
Icgishiture  wliicli  would  enact  such  a  hiw.  Tlii!  miiiiieiit  it  is  passed,  all  the  thniUL'h 
traile,  all  tho  vast  aocuniulationH  of  the  produce  of  the  Wi-^t  which  now  find  tlu-ir 
way  to  New  York  by  the  New  York  Central  Railroad,  will  desert  it.  Wlioii  tiie 
Governor  of  New  York  signs  the  bill  preventing  free  competition  between  our 
Central  Railroad  and  its  moi'e  southern  rivals,  ho  signs  a  bill  for  the  relief  of 
Philadelphia   and  the    nggrandizeinent   of   IJaltiniore,  and    there  will   bo   great 

rejoicing  in  those  eities,  whether  it  be  publicly  expressed  or  not The 

people  of  Maryland  and  Pennsylvania  niake  no  laws  to  prevent  the  competition 
of  their  railways  with  onrs.  They  are  satisfied  to  let  those  who  manage  tliem 
draw  off  as  great  a  proportion  of  the  freight  from  our  channels  of  transportation 
as  they  are  able,  and  they  will  be  very  glad  of  our  co-operatiou  iu  this  work. 


' 


38 


FINANCIAL   CRISES 


r»iiltimnro  hn?  invostcd  sixty  millions  of  ilollnrf  in  tlic  riiilways  which  centre  in 
that  11innisliiii.!i  city.  Wlietlicr  tliese  nro  profitably  niannj^eil  or  not,  is  not  so 
much  the  question  Vith  those  who  contribute  the  nionoj-,  ns  whether  the  effect 
shall  bo  to  build  up  Baltimore  as  a  great  mart,  and  make  Maryland  the  thorough- 
fare of  an  active  trade.  Baltimore  is  the  commercial  gate  of  the  South;  her 
fimbition  i.s  to  become  that  of  the  West  also.  No  measure  could  be  better  calcu- 
lated to  con'qiire  with  this  ambition,  and  further  this  intent,  than  the  pro  rata 
freij-'ht  bill  now  before  our  legislature.  We  earnestly  liopo  that  those  members 
who  have  been  indueed  to  favor  it  will  give  the  subject  a  more  careful  considera- 
tion, and  spare  us  from  an  enactment  the  error  of  which  will  bo  but  too  deplorably 
evident  before  another  legislature  can  assemble." 

In  all  this,  I  find  no  .sino-lo  word  in  favor  of  the  farmens  and  land- 
holders of  your  State  —  those  people  upon  whom  you  no  long  have 
urji ■■  1  consideration  of  the  advantage  that  must  result  to  them  from 
destroying  internal  commerce  and  readopting  the  ccdonial  system  against 
which  our  predecessors  made  the  devolution.  Had  you  now  occasion  to 
talk  to  //ir??7,  you  would  probably  say  —  "Gentlemen  farmers,  you  are 
entirely  in  error  in  supposing  that  you  have  any  interests  that  require 
to  be  considered.  The  more  you  can  be  forced  to  become  dependent 
upon  Britain,  the  more  rapid  will  bo  the  growth  jf  cities  like  our  own. 
That  the  dependence  may  be  increased  it  is  needed  that  we  close  the 
i/.ills,  mines,  and  furnaces  of  the  Union ;  that  we  render  the  laborer 
more  and  more  dependent  upon  the  capitalist;  that  financial  crises  con- 
tinue to  increase  in  number  and  intensity;  that  the  rate  of  interest  be 
maintained  so  high  as  to  ruin  farmers,  manufacturers,  and  railroad  com- 
panies, while  increasing  the  number  of  millionaires ;  that  pauperism  and 
crime  continue  to  increase,  with  constant  diminution  in  the  power  to 
purchase  the  products  of  the  farm ;  that  the  productiveness  of  your  land 
continue  to  diminish  as  it  now  is  doing;  that  our  people  be  dispersed; 
and  that  railroads  continue  to  co-ojjcratc  with  the  government  in  the 
effort  to  destroy  that  power  of  association  to  which,  alone,  should  we 
look,  did  we  desire  to  witness  your  growth  in  strength,  wealth,  and  power. 
The  heavier  your  taxation,  the  higher  will  be  the  prices  of  our  city  lots." 
That  the  British  free  trad'>  system  is  one  of  universal  discord  is  proved 
by  the  commerce  of  India,  Ireland,  Turkey,  and  all  other  countries 
subject  to  it,  and  by  our  own,  in  every  period  of  its  existence.  That 
opposition  to  it  is  productive  of  liarniony,  force,  and  strength,  is  shown 
in  the  movements  of  Germany,  France,  and  every  other  country  that 
looks  to  the  development  of  internal  commerce  as  furnishing  the  real 
base  of  an  extended  intercourse  with  other  nations.  Turn,  if  you  please, 
to  the  recent  letter  of  the  French  Emperor,  and  find  him  telling  his 
finance  minister  that— - 

"One  of  the  greatest  services  to  be  rendered  to  the  country  is  to  facilitate  the 
transport  of  articles  of  first  necessity  to  agriculture  and  industry.  With  this 
object,  the  Minister  of  I'liblic  Works  will  cause  to  be  executed  as  promptly  as 
possible  the  means  of  communication,  canals,  roads,  and  railways,  whose  main 
object  will  be  to  convey  coal  and  manure  to  the  districts  where  the  wants  of  pro- 
duction require  them,  and  will  endeavor  to  reduce  the  tariffs  by  establishing  an 
equitable  competition  between  the  canals  and  railways." 

Compare  with  this  the  teachings  of  the  Post,  and  j'ou  will  find  the 
latter  saying  directly  the  reverse — txhibiting  the  advantage  of  sendino- 
to  England  all  our  products   in  their  rudest  forms,  thus  losing  the 


THEIR   CAUSES   AND   EFFECTS. 


80 


manure,  and  dilvinj!;  our  people  to  the  West,  there  to  find  a  constant 
increase  in  the  ncce.ssity  for  roads,  accompanied  by  as  constant  decrease 
in  the  power  to  make  tlicni. — That  done,  allow  me  to  as^k  your  attention 
to  the  steady  growth  of  harmony  in  the  interests  of  railroad  owners, 
farmers,  and  niaiiufacturers,  exhibited  in  the  following  figu'  es  repre- 
senting the  receipts  of  Trench  railroads  in  recent  years  : 


Total  Receipts. 


Beceipks  per  Kilometer. 
Friiuca. 


1857 
1858 


311,608,012  45,259 

335,230,015  41,398 


The  year  following  the  great  financial  crisis  exhibits,  thus,  a  larger 
receipt  than  that  by  which  it  had  been  proceeded.  —  Look  now  to  the 
receipts  of  the  first  half  of  the  two  past  years,  as  follows,  and  mark  the 
great  increase  that  has  since  been  made  — 


Totftl  Receipts. 
Francs. 


Receipts  per  Kilometer. 
Francs. 


1858 
1859 


148,955,578  19,.S05 

181,095,004  20,G99 


Compare,  I  pray  you,  my  dear  sir,  the  movement  thus  indicated  with 
that  exhibited  among  ourselves  in  the  past  three  years,  and  you  will 
have  little  difficulty  in  comprehending  why  it  is,  that  our  railroad  cnr^  ■ 
panics,  like  our  farmers  and  manufacturers,  our  miners  and  our  ship- 
owners, are  now  being  ruined  —  the  81200,000,000  expended  in  their 
construction  havini;  at  this  moment  a  market  value  that  can  scarcely  ex- 
ceed, even  if  it  equal,  $400,000,000. 

Looking  at  all  these  facts,  is  it  not  certain,  my  dear  sir,  — 

That  the  free  trade  system  of  which  you  are  the  advocate  is  one  of 
universal  discord  ? 

That  it  tends  to  the  involvement  of  men  of  all  pursuits  in  life,  and 
of  the  Union  itself,  in  one  great  and  universal  ruin  ?     And,  therefore, 

That  it  is  to  the  intcest  of  the  railroad  proprie'  )r  to  unite  with  the 
farmer  in  promoting  the  adoption  of  measures  having  for  their  object 
the  development  of  our  mineral  wealth,  the  creation  of  a  real  agricul- 
ture, and  the  extension  of  domestic  commerce  ? 

Hoping  for  replies  to  these  questions,  and  ready  to  give  them  cir- 
culation among  millioiis  of  protectionist  readers,  I  remain,  with  much 
respect,  Yours,  very  truly, 

Heniiy  C.  Carey. 


W.  C.  Bryant,  Esq. 


PuiLADEtPniA,  February  20,  1860. 


I 


40 


FINANCIAL  crises: 


hi 


LETTER    NINTH. 


From  (he  Evening  Post,  Tuesday,  February  2\st. 

"An  ATTEMrT  to  Revive  an  Old  AnrsE.  —  It  is  intimated,  we  know  not  on 
what  authority,  that  the  Cumiuittec  of  Ways  and  Means  are  about  to  report  a  bill 
to  the  House  of  Rcpresentntivcs,  with  tlie  view  of  carrying  into  eifcct  Mr.  Bucha- 
nan's reconmieiidation  to  return  to  the  old  system  of  specific  duties, 

"  If  this  be  so,  our  aged  President,  who  has  been  worrying  about  specific  duties 
ever  since  he  took  the  Executive  chair,  will  undoubtedly  enjoy  a  slight  sense  of 
relief.  For  our  part,  we  should  be  perfectly  willing  to  sec  him  gratified  in  this 
respect,  if  the  measure  suggested  did  not  imply  an  impeachment  of  the  good  sense 
of  tlie  committee  by  whom  the  bill  is  said  to  be  preparing,  and  if  the  return  to 
specific  duties  were  not  simply  a  device  to  increase  the  burdens  of  the  people. 
The  mill-owners  are  not  satisfied  with  their  profits;  they  do  not  make  money 
enough  by  selling  their  merchandize,  and  they  call  for  specific  duties  to  enable 
them  to  extract  a  more  liberal  revenue  from  those  with  whom  they  deal. 

»'  This  is  the  plain  English  of  the  clamor  for  specific  duties.  The  consumers  do 
not  w  t  them,  do  not  ask  for  them,  are  satisfied  with  the  present  method  of  col- 
lecting the  duties  by  a  percentage  on  the  value  of  the  goods  imported;  the  only 
change  they  wish  for  is  that  the  duties  should  be  made  lighter.  Only  the  frater- 
nity of  mill-owners,  shareholders  in  manufacturing  corporations,  capitalists  who 
are  anxious,  as  all  capitalists  naturally  arc,  to  make  what  they  possess  more  pro- 
ductive than  it  noAV  is,  ask  for  the  imposition  of  specific  duties.  They  have  not 
the  face  to  ask  for  a  direct  increase  of  the  duties  as  they  now  stand ;  they  are 
afraid  to  demand  that  a  tax  of  fifteen  per  cent  on  imported  merchandize  shall  be 
raised  to  twenty  per  cent,  or  a  duty  of  twenty  to  one  of  twenty-five  or  thirty. 
The  country  would  cry  shame  on  any  such  change.  They,  therefore,  get  at  the 
same  thing  indirectly;  they  wrap  up  the  increase  of  taxation  in  the  disguise  of 
specific  duties ;  the  consumer  is  made  to  pay  more,  but  being  made  to  pay  it 
under  the  name  of  specific  duties,  the  increase  is  of  such  a  nature  that  it  will  be 
apparent  only  to  an  expert  mercantile  calculator.  The  consumer  finds  that  the 
commodity  he  needs  bears  a  higher  price,  but  he  is  mystified  by  the  system  of 
specific  duties,  and  does  not  know  that  the  increase  of  price  is  a  tribute  which  he 
is  forced  to  pay  to  the  mill-owners. 

"  That  class  of  men  who  own  our  manufacturing  establishments  have  had  pos- 
session of  the  legislative  power  of  the  country  long  enough.  It  is  quite  time  that 
the  committees  of  Congress,  and  those  who  vote  on  the  schemes  laid  before  them 
by  those  committees,  should  begin  to  consult  the  wishes  of  the  people.  It  is  high 
time  that  they  should  begin  to  ask,  not  what  will  satisfy  the  owners  of  forges, 
and  foundries,  and  coal-mines,  and  cotton-mills,  and  woollen-mills,  but  what  is 
just  and  fair  to  those  who  use  the  iron,  and  warm  their  habitations  with  the  coal, 
and  wear  the  woollens  and  the  cottons.  This  is  not  done;  the  lords  of  the  mills 
speak  through  tt)e  mouth  of  the  President  of  the  Republic  and  call  for  specific 
duties,  and  now  we  are  told  that  they  are  dictating  a  bill  to  the  Committee  of 
Ways  and  Means. 

"  Great  apprehensions  have  been  entertained  by  many  persons,  both  here  and 
abroad,  lest  minorities  should  be  oppressed  in  our  country  by  unjust  laws  passed 
in  obedience  to  the  demand  of  the  mass  of  the  people.  We  received,  not  long 
since,  a  letter  from  England,  rn  which  great  anxiety  was  expressed  lest  this  should 
lead  to  the  downfall  of  our  government.  Hitherto,  however,  the  people  in  this 
country  have  been  oppressed  by  powerful  and  compact  minorities.  Laying  aside 
the  fact  that  small  classes  of  men,  united  by  a  very  perfect  mutual  understanding, 
and  wielding  large  capitals,  too  often  domineer  in  our  State  legislatures,  it  is 


1 


TIIKIR   CAUSES   AND   EFFECTS. 


41 


certain  that  the  revenue  laws  of  this  country  hnvo,  for  mnr\y  vonrs  pnpt,  been 
frnmed  by  a  minority.  The  mill-owners  liiive  ilictiitpd  tlio  wliole  systciu  of  indi- 
rect taxation,  ever  since  the  last  war  with  (Jreat  IJritain,  and  tlie  utmost  we  have 
been  able  to  obtain  in  the  struggle  agaiti^it  tlieir  supremacy  has  been  some  miti- 
gation, some  relaxation  of  the  protective  system  —  never  a  comjilete  release  from 
it.  The  oligarchy  of  slaveholders,  scarcely  more  numerous  than  that  of  the  mill- 
owners,  and  'equally  bound  together  by  a  common  interest  and  concei'tod  plans 
of  action,  have  held  the  principal  public  offices,  interpreted  the  laws,  and  swayed 
the  domestic  policy  of  the  country  with  a  more  and  more  rigorous  control  for 
many  years  past.  AVe  are  engaged  in  a  struggle  with  that  oligarcliy  now;  but  we 
have  no  idea  of  allowing  the  other  oligarcliy  of  mill-owners,  while  we  are  thus 
engaged,  to  step  in  and  raise  the  tribute-money  we  pay  them  to  tlic  old  rates. 
What  we  have  wrested  from  their  tenacious  grasp  we  shall  keep,  if  possible. 

♦'  Other  governments  are  breaking  the  fetters  which  have  restrained  their 
peaceful  intercourse  with  each  other,  and  adopting  a  more  enlightened  system  — 
a  system  which  is  the  best  and  surest  pledge  of  enduring  amity  and  peace  between 
nations.  England  and  France  are  engaged  in  putting  an  end  to  the  illiberal  and 
mutually  mischievous  prohibitive  system  in  their  commerce  with  each  other.  It 
will  dishonor  us  in  the  eyes  of  the  civilized  world  if  we,  who  boast  of  the  freedom 
of  our  institutions  and  the  wisdom  of  our  legislation,  should  in  the  meantime  be 
seen  picking  up  the  broken  fetters  of  that  system,  and  putting  them  into  the 
hands  of  artisans  at  Washington  to  forge  them  again  into  handcutfs  for  our  wrists. 
If  any  such  bill  as  is  threatened  should  be  introduced  into  Congvp^s  by  the  Com- 
mittee of  Ways  and  Means,  we  trust  that  the  Republicans  of  the  Western  States 
will  be  ready  to  assist  in  giving  it  its  death-blow.  If  it  do  not  meet  its  quietus 
from  them,  it  will  probably  be  rejected,  as  it  will  richly  deserve,  in  the  Senate, 
and  Mr.  Buchanan  will  never  have  the  satisfaction  of  giving  it  his  signature." 


Dear  Sir  : — You  have  been  invited  to  lay  before  your  readers  the 
arguments  in  favor  of  such  a  change  in  our  counuercial  policy  as  should 
tend  to  produce  diversification  in  the  demand  for  human  service, 
thereby  increasing  the  power  of  association  and  the  productiveness  of 
labor,  while  relieving  our  farmers  from  a  tax  of  transportation  ten  times 
more  oppressive  than  all  the  taxes  required  for  the  support  of  European 
fleets  and  armies  —  that  invitation  having  been  given  in  the  hope  that 
by  its  acceptance  you  would  make  manifest  your  willingness  to  permit 
your  readers  to  sec  both  sides  —  your  entire  confidence  in  the  accuracy 
of  the  economical  doctrines  of  which  you  have  been  so  long  the  earnest 
advocate  —  and  your  disposition  to  espouse  th(>  cause  of  truth,  on  what- 
Boever  side  she  might  be  found.  That  you  should  have  failed  to  do  this 
has  boon  to  me  a  cause  of  much  regret,  having  hoped  better  things  of 
a  lo'Tv  of  freedom  like  yourself  Resolved,  however,  that  vij/  readers 
shall  ii.vo  full  opportunity  to  judge  for  theniseives,  I  now,  as  you  see, 
place  V,  'Oiin  the  reach  of  the  great  mass  of  the  protectionists  of  the 
Union,  tl  0  reply  that  you  have  just  now  published,  sincerely  hoping 
that  they  may  give  to  it  the  most  careful  study,  and  thus  enable  them- 
selves to  form  a  correct  estimate  of  the  sort  of  arguments  usually  adduced 
in  support  of  that  British  free  trade  policy  which  has  for  its  object  tlie 
limitation  of  our  farmers  to  a  single  and  distant  market  for  their  products 
—  the  maintenance  of  the  existing  terrific  tax  of  transportation  —  and 
the  ultimate  reduction  of  our  whole  people  to  that  state  of  colonial 
dependence  from  which  we  were  rescued  by  the  men  who  made  the 
revolution. 

As  presented  by  me,  the  question  we  are  discussing  is  not  of  the 
prices  of  cotton  goods,  but  of  human  freedom,  and  in  that  light  it 


42 


FINANCIAL  crises: 


1-1' 


I''' 
W 

W 
I 

I;  i 
t'  t 


is  that  T  liavi'  Itoutrcd  you  should  eoiisidor  it.  In  support  of  that 
view,  I  liavo  urm'd  upon  your  consideration  the  facts,  tliat  every  Britisli 
^ree  trade  period  has  closed  with  one  of  those  fearful  crises  whose 
sad  ellects  you  have  so  well  depicted;  that  crises  have  been  followed 
by  paralyses  of  the  domestic  coiunierce,  destroyinjr  the  demand  for 
labor ;  atid  that,  as  a  necessary  consequence,  each  such  period  has  been 
marked,  on  oiu?  side,  by  a  great  increase  in  the  number  of  millionaires, 
and  on  the  other,  by  such  a  growth  of  pauperisTu  that  that  terrible  dis- 
ease ajtpears  now,  to  use  your  own  words,  "  like  the  Canadian  thistle,  to 
have  settled  on  our  soil,  and  to  have  germinated  with  such  vigor,  as  to 
defy  all  half  measures  to  eradicate  it."  Further,  you  have  been  asked 
to  look  to  the  faots,  that  the  reverse  of  all  this  has  been  experienced  in 
every  period  of  the  protective  system  —  domestic  commerce  having  then 
grown  rapidly,  with  constant  increase  in  the  demand  for  labor,  and  as 
constant  augmentation  in  the  regularity  of  the  socictary  action,  in  the 
freedom  and  hap])iness  of  our  people,  in  the  strength  of  the  government, 
and  in  the  contidence  of  the  world,  both  at  home  and  abroad,  in  the 
stability  of  our  institutions.  Such  is  the  view  that  luxs  been  presented 
to  you,  in  the  hope  and  belief  that  to  a  lover  of  freedom  like  yourself 
it  would  be  one  of  the  highest  interest,  and  that  it  would  be  met  and 
considered  in  a  manner  worthy  of  a  statesman  and  a  Christian.  Has  it 
been  so  considered  i'  To  an  examination  of  that  question  I  shall  now 
ask  your  attention,  reserving  for  a  future  letter  the  consideration  of  the 
effects  of  the  advalorem  system  in  producing  those  financial  crises  whose 
terrible  effects  you  have  so  well  depicted,  and  that  pauperism  and  crime 
■whose  growth  you  have  so  much  deplored. 

The  experience  of  the  outer  world  is  in  full  accordance  with  our  own, 
the  whole  proving  that  the  tendency  toward  harmony,  peace,  and  freedom, 
exists  in  the  direct  ratio  of  the  diversity  in  the  demand  for  human  force, 
and  consequent  power  of  combination  among  the  men  of  whom  society 
is  composed.    Therefore  is  it,  that  the  most  distinguished  economists  are 
found  uniting  in  the  idea  expressed  by  T^.  Chevalier,  the  free  trader 
whom  you  so  much  admire,  that  it  is  only  "  the  accomplislmient  of  a, 
positive  duty"  on  the  part  of  governments,  so  to  direct  their  measures 
as  to  facilitate  the  taking  possession  of  all  the  various  branches  of  indus- 
try for  which  the  country  has  been  by  nature  suited.    Such  must  be  the 
view  of  every  real  statesman  —  recognizing,  as  such  men    must,  the 
existence  of  a  perfect  harmony  in  the  great  and  permanent  interests  of 
all  the  various  portions  of  society,  laborers  and  capitalists,  producers 
and  consumers,  farmers  and  manufacturers.    Of  such  harmony,  however, 
you  give  your  readers  none — consumers  of  cloth  and  iron  here  being  told 
that  capitalists  "not  satisfied  with  their  profits"  are  anxious  to  "  increase 
the  burdens  of  the  peojjlc ;"  that  "  the  fraternity  of  mill-owners,"  and 
they  alone,  are  anxious  for  a  change  of  system,  with  increase  of  taxes ; 
that  "  the  lords  of  the  mills"  are  dictating  to  the  Committee  of  Ways  and 
Means;  that  "mill-owners  have  dictated  the  whole  system  of  indirect 
taxation ;"  and  that  it  is  high  time  fur  them  now  to  protest  against  the 
further  maintenance  or  extension  of  the  system.     Here,  as  everywhere, 
you  are  found  in  alliance  with  that  British  free  trade  system  which 
.     seeks  the  production  of  discord,  and  discord  and  slavery  march  always 
band  in  hand  together  through  the  world. 


Til  Kin   CAUSKS   AND   EFFECTS. 


43 


■f 

)i:. 


Allow  nio  now,  my  <l<'nr  sir,  in  ask  you  if  yon  roally  lulicvo  lliat  (ho 
factM  lire  hiii'Ii  iih  tfiry  licro  arc  siid  to  Ito?     Du  you  imt,  as  well  as 
iiiyHclC,  l'iiou\  that,    lor  y(>aiH    past,  the  wealthy  mill  owners  of   New 
Eiifihmd   liuvn  hceii   o|i|i(i>t:(|   to   any  ehan<;o  of  system   that   eonld,  by 
givin;^'  inerenHeiJ  jiroteetion,  tend  to  augment  donu'stie  eomjietiiion  for 
the  sale  of  clotli,  knowing,  ns  thciy  did,  tlmf  si'ch  comprtltlon  muat  dc- 
rrrdnf  f/ir  I'oHt,  iif  vhith  In  llir  cmisvinrr.     80  is  it  now,  with  tlie  wealthy 
iron  master,     lie  can  live,  thouj^h  all  around  him  may  Ite  erushed  by 
liritish  eomjii'tilioM  ;    and  then,  in  common  with   his  wealthy  IJritish 
rivals,  he  ninst.  jirolit  hy  the  destruction  they  have  made.     iSueh  being 
the  facts,  ii"d  ijnit  they  are  so  I  can  positively  assert,  are  y(ju  not,  by 
opiiosini^'  proleetivo  measures,  aidin^;'  in  the  creation  among  ourselves  of 
a  lilthi  "  o|i;.'ai'idiy  of  mill  owners,"  whose  power  to  increase  the  "  tribute 
money"  (d'  which  you  no  much  complain,  results  directly  from  the  failure 
of  Conjjrertrt  H(t  to  net  as  to  increase  domestic  competition  for  the  sale 
of  cloth  and  iron  '(     The  less  that  competition,  the  less  must  bu  the  re- 
ward of  labor,  and  the,  lar;:,er  the  proiits  of  the  capitalist,  but  the  greater 
mrtst  111'  the  tendency  towards  jiauperisui  and  crim»,  and  the  less  the 
power  to  tfonsiimc  either  cloth  or  iron. 

"  llithorlo,"  as  you  here  tell  your  readers,  our  people  "have  been 
oppressed  by  powerful  ami  compact  minorities."  In  this  jni  are  right 
—  a  snndl  minority  of  voters  in  the  Southern  States  having  dictated  the 
repeal  of  the  protective  tariffs  of  lSl'8  and  ISdli,  and  having  now,  with 
a  single  and  briej'  exce]ption,  dictated  for  thirty  years  both  the  foreign 
and  donu'htie  policy  of  this  country.  In  1S40,  iiowever,  the  free  peo]dc 
of  our  NorthiTii  Stat"s,  liirmers,  mechanics,  laborers,  and  miners  —  the 
men  who  had  labor  to  sell  and  knew  that  it  commanded  better  prices 
in  pDtoctive  lliaii  in  i'ree  trade  times  —  rose  in  their  mi^dit  and  hurled 
from  power  (his  little  "  oligarchy"  of  slave  owners,  then  taking  for  thcm- 
BclvcH  the  ])roleelioii  which  they  felt  they  so  greatly  needed.  That  it 
is,  whioli  they  now  seek  again  to  do  —  desiring  once  again  to  free  them- 
selves IVom  llio  control  of  that  "powerful  and  compact  minority"  of 
Blavcdiohh'rs,  under  whose  iron  rule  they  so  long  have  suifered. 

Periiiit  me  imw,  mv  dear  sir,  to  ask  on  what  side  it  was  you  stood,  in 
the  great  (tontest  of  l^l'Jl*  AVas  it  with  the  poor  farmer  of  the  North 
who  sought  emancipation  from  the  tax  of  transportation,  by  the  creation 
of  a  domcMtie  market  litr  his  products  ?  Was  it  with  the  mechanic  who 
pctught  the  re-opening  of  the  shop  in  which  ho  so  long  had  wrought  1* 
Was  it  with  the  laborer  whose  wife  and  children  were  perishing  for  want 
of  food  'f  Was  it  with  the  little  shopkeeper  who  found  his  little  capital 
disappearing  nndrr  demands  for  the  payment  of  usurixjus  interest  ?  Was 
if  tint,  on  the  contrary,  with  that  "little  oligarchy"  of  men  who  owned 
the  laborers  they  emjiloyed,  and  opposed  the  protective  policy,  because 
it  looked  to  giving  the  laborer  increased  control  over  the  products  of 
his  labor':*  Wax  it  vnt  with  the  rich  capitalist  who  desired  that  labor 
might  be  cheap,  ami  nmney  dear?  ll'^.s  it  not  witli  those  foreign 
ct.pitalists  who  tlesired  that  raw  materials  nught  be  low  in  price,  and 
cloth  and  linen  highl'  Wim  it  not  with  those  Uritish  statesmen  who  find 
in  the  enormoiiK  capitals  of  Knglish  iron  masters  "the  most  potent  in- 
BtrunuMits  of  warfare  against  tin;  competing  industry  of  other  countries"  'I 
To  all  timsc  (jueslions  the  answers   must  be  in  the  allirmative,  your 


mmm 


44 


FINANCIAL  crises: 


m 


journal  liaviiig  then  stood  couspiouous  nmong  the  aJvocatoa  of  pro- 
sluvory  (loiiiiiiatiori  over  tho  {'vw.  laboivrs  of  the  Northern  State  •'  — 

Wo  have  now  aiiotlicr  froo  trach;  period,  when  crisis  has  been  foHowed 
by  paralysis,  and  it  may,  my  dear  sir,  bo  not  improper  to  inquire  on  what 
hide  it  is  that  you  now  are  placed.  Is  it  by  the  side  of  the  free  laborer 
who  is  perishin;^  because  of  inability  to  sell  his  labor  ?  Is  it  by  that 
of  the  pooi"  farmer  of  the  West,  who  tinds  himself  compelled  to  pay  five 
per  cent,  j)er  mouth,  to  the  rich  ca])ifalist?  Is  it  by -that  of  the  unem- 
ployed mechanic  of  the  Middle  and  Northern  States?  Is  it  by  that  of 
the  farmer  whose  land  diminishes  in  value  because  of  the  enormous  tax 
of  transportation  to  which  ho  is  subjected 'Z  Is  it  not,  on  the  contrary, 
by  the  side  of  that  "  little  oligarchy"  which  holds  to  the  belief  that  the 
laborer  is  "  the  mud-sill"  of  society,  that  slavery  for  the  white  man  and 
the  bhi'k  is  the  natural  order  of  thinj^s,  and  that  "free  society  has 
proved  a  failure  "?  For  an  answer  to  these  (juestions,  allow  me  now  to 
point  you  to  the  fact  that  you  have  here  invoked  the  aid  of  a  Senate, 
the  control  of  which  is  entirely  in  the  hands  of  that  same  "  oligarchy," 
for  resisting  any  and  every  change  in  our  commercial  policy  asked  for 
by  the  farmers  and  laborers  of  the  Northern  States.  Now,  as  for  thirty 
years  past,  your  opponents  are  found  among  the  men  who  sell  their  own 
labor,  while  your  chief  allies  are  tijund  in  the  ranks  of  those  by  whom 
such  men  are  classed  as  sevl's.  Need  we  wonder,  then,  that  your  journal 
should  be  always  advocating  the  cause  of  the  millionaires,  and  thus 
helping  to  augment  the  pauperism  and  crime  whose  rapid  growth  you 
60  much  lament? 

The  facts  being  thus  so  entirely  the  reverse  of  what  you  have  stated 
them  to  be,  is  it  not,  my  dear  sir,  most  remarkable  — 

That,  after  aiding,  durii.g  so  long  a  period,  in  the  establishment  of 
pro-slavery  domination  over  our  domestic  and  foreign  commerce,  you 
should  now  venture  to  assert,  that  "  the  mill  owners  have  dictated  the 
whole  system  of  indirect  taxation,  ever  since  the  late  war  with  Great 
Britain  "  ? 

That,  the  necessity  for  resort4ng  to  such  mis-statements  does  not  furnish 
you  with  proof  conclusive  of  the  exceediug  weakness  of  the  cause  in 
support  of  which  you  are  engaged  ? 

'That,  regard  for  truth  does  not  prompt  you  to  a  re-examination  of  the 
question,  with  a  view  to  satisfying  yourself  that  of  all  tlu;  pro-slavery 
advocates,  the  Journal  of  Commrrcc.  not  excepted,  there  is  not  even  a 
single  one  that  has  proved  more  efficient  than  yourself? 

Hoping  that  you   may  follow  my  example  by  giving  this  letter  a 

place  in  your  columns,  and  ready  to  place  within  the  reach  of  millions 

of  protectionist  readers,  whatever  answer  you  may  sett  fit  to  make,  I 

remain.  Yours,  very  respectfully, 

IIemiy  C.  Carey. 
W.  C.  Dryant,  Esq. 

ruiLAUELPiiiA,  February  28,  1800. 


TIIEItl  CAUSES   AND  EFFECTS. 


45 


[LETTER    TENTH. 

Drar  Hill,  — Allow  liic  io  bog  that,  you  now  review  with  me  sonic 
of  the  facts  thiit  tliiiM  fur  Imvc  been  presented  for  your  coiuslderation, 
havintr  <lono  wlii(Oi,  I  will  ask  you  to  say  if  in  the  annals  of  the  world 
there  can  uiiywlitir**  bo  I'olitid  tt  more  adniirablc  contrivance  for  the  anni- 
hilation of  douicstit!  (Mtinnicrco  than  that  which  exists  among  ourselves, 
consofjiiont  npoii  tha  adoption  of  JJritish  free  trade  doctrines.     Closing 
our  nulls  and  fiii'liiicoH,  the  g(jvernmcnt  compels  our  people  io  seek  the 
"West.   There  arrived,  they  fltul  themselves  taxed  for  transportation  to  such 
extent  that  not  only  have  they  no  power  to  develop  the  mineral  wealth 
that  BO  much  aboiintlH,  but  arc  wholly  unable  even  to  construct  roads  by 
means  of  whieh  to  ^d  to  the  distant  market.     Few  in  number  and  poor, 
they  are  driven  to  Meek  relief  at  the  hands  of  their  British  friends,  or 
masters,  iiledjiing  tht'lr  landM  and  houses  as  security  for  the  payment  of 
railroad  boiidrt,     In  duo  Heason,  the  foreign  creditor  becomes  owner  of 
the  road,  nnximiH  to  increaso  his  revenue,  but,  above  all,  anxious  to 
ju'omoto  the  disperHJotj  of  our  people,  and  to  secure  the  maintenance  of 
our  existing  colon iul  depoiidencc.     Seeking  to  accomplish  that  object, 
he  taxes  i/ovt'  i'lmuvvn  ior  the  transportation  of  the  produce  of  distant 
hinds  —  compelling  (hrm  to  make  good  all  the  losses  resulting  from 
cheaply  carrying  dio  iiroducts  of  Wisconsin  and  Minnesota.     Thus  de- 
stroying the  vaine  of  the  land  and  labor  of  Atlantic  States,  he  compels 
u  further  emigi'iition,  and  thus  on  and  on  he  goes  —  fully  carrying  out 
the  ]5ritisli  plan  (tf  roeolonizntion,  while  always  lauding  the  advantages 
to  be  derived  fruui  the  llritish  free  trade  system.     It  is  a  remarkably 
ingenious  ftrrangcnioiit,  and  the  more  you  study  it,  the  more,  my  dear 
sir,  you  muHt  bo  led  to  wonder  at  the  folly  of  our  people  in  having  so 
long  submitled  to  It.     Tlio  British  people  are  somewhat  heavily  taxed, 
but  for  every  tlolliu*  they  pay  for  the  support  of  their  own  system,  do 
not  our  people  puy  tun  for  the  support  of  forcijn  people  and  furelyn 
yovernminls? 

That  the  Htrength  of  a  community  grows  as  its  internal  commerce 
increases,  and  dtM'llncf*  ns  that  commerce  decays,  is  proved  by  the  history 
of  every  nation  of  the  world.  Such  being  the  case,  allow  me  to  ask  you 
now  to  look  with  mo  into  that  commerce  among  ourselves,  with  a  view 
to  determining  itn  oxtcnt.  How  much  does  Kentucky  exchange  with 
JNIissouri?  AVhat  in  tho  annual  value  of  the  commerce  of  Ohio  Avith 
Indiana,  or  of  Virginia  with  Kentucky?  Scarcely  more,  as  I  imagine, 
than  that  of  ft  Hlngle  day's  labor  of  their  respective  populations ;  and, 
perhaps,  nut  even  hiilf  so  maeh. — Why  is  this  the  case?  Is  it  not 
a  uecessarv  ConHe(Hicnco  of  the  absence  of  that  diversity  of  employ- 
ments irithi'n  thi'  iS/itfi'K,  everywhere  scon  to  be  so  indispensable  to 
the  maintenunee  of  connnerce?  Assuredly  it  is.  Ohio  and  Indiana 
have  little  more  tliiin  one  ptirsuit  —  that  of  tearing  out  the  soil,  and  ex- 
porting it  in  the  I'orni  of  food.     Virginia  and  Kentucky  sell  their  soil 


46 


FINANCIAL   CRISES  : 


li 


m 


in  tho  fiiriiis  of  toLacco  and  of  porn.  Carolina  and  Alabama  liavo  tho 
sanu;  pursuits ;  and  so  it  is  tlirouuliout  hy  far  tlio  larjior  portion  of  tho 
Union  —  millions  of  people  hviuv:  cnijiloji'd  in  one  part  of  it,  in  robbing? 
the  earth  of  tlio  constituents  of  tcitton,  while  in  others,  other  millions 
are  eniploj-ed  in  plunderiiiij;  the  ureat  treasury  of  nature,  of  the  constitu- 
ents of  wheat  and  riee,  corn  and  tobacco,  and  thus  destroying,  for  them- 
selves and  their  successors,  the  power  to  maintain  commerce. 

The  commerce  (»f  State  with  State  is  thus,  as  you  see,  my  dear  sir, 
but  very  trivial ;  and  the  reason  vhy  it  is  so,  is,  that  the  commerce  of 
man  with  his  lellow-man,  within  the  States,  as  a  general  rule,  is  so  ex- 
ceedingly diminutive.  "Were  the  people  of  Illinois  enabled  to  develop 
their  almost  boundless  deposits  of  coal  and  iron  ore,  and  thus  to  call  to 
their  aid  the  wonderful  power  of  steam,  the  internal  commerce  of  the 
State  would  grow  rapidly  —  making  a  market  at  home  for  the  Ibod  pro- 
duced, and  enabling  its  producer  to  become  a  large  consumer  of  cotton. 
Cotton  mills  then  growing  up,  bales  of  cotton  wool  would  travel  up  tho 
Mississippi,  to  be  given  in  exchange  for  the  iron  required  for  the  roads 
of  Arkansas  and  Alabama,  an*d  I'or  the  machinery  <lemanded  for  the  con- 
struction of  cotton  and  sugar  mills,  in  Texas  and  Louisiana. 

That,  however,  being  precisely  the  sort  of  commerce  which  Britain 
so  much  dreads,  and  that,  too,  which  our  own  government  desires  to 
destroy,  the  capitalist  feels  no  confidence  in  any  road  dependent  upon  its 
growth,  whether  for  the  payment  of  interest  upo.i  'Is  bonds,  or  dividends 
apon  its  stock.  Hence  the  almost  entire  impossibility  of  obtaining  the 
means  of  making  any  road  that  does  not  lead  diroctly  to  Liverpool  and 
IManchester.  Look  with  me,  I  pray  you,  into  the  lleport  just  now  pub- 
lished, of  the  Sunbury  and  Erie  Railroad  —  running,  as  it  does,  through 
a  country  abounding  in  mineral  wealth  and  fertile  lands.  Its  length 
is  288  miles,  248  of  which  are  already  made,  and  148  completed  by 
the  laying  of  the  iron  —  the  expenditure  having  somewhat  exceeded 
$8,500,000.  There,  however,  the  work  stops,  it  being  quite  impossible 
to  obtain,  even  as  a  temporary  loan,  either  at  home  or  abroad,  the  trivial 
sum  that  is  yet  required,  except  at  the  cost  of  sacrifices  that  must  be 
ruinous  to  those  who  have  commenced  the  work.  Until.it  shall  be 
obtained,  the  capital  already  expended  must  fail  to  be  pu'oductivc,  and 
lands  equal  in  extent  to  a  moderate  German  kingdom,  nuust  fail  to  con- 
tribute to  the  maintenance  oi  our  people,  and  to  the  increase  of  the 
States  in  wealth,  strength,  and  power. 

Thirty  years  since,  (lermany  did  rs  wo  are  doing,  exporting  raw  ma- 
terials, and  importing  finished  products.  Adopting  protection,  she  has 
placed  herself  in  a  position  to  compete  with  Britain  for  the  purchase  of 
wool  and  cotton,  and  for  the  export  of  knives  an<l  cloth.  Then  she  was 
poor,  but  now  she  is  so  rich  that  her  people  take  from  us  bonds  by 
which  ou/  roads  and  lands  are  bound  for  the  payment  of  rates  of  inte- 
rest so  enormous  as  to  ruin  the  persons  whose  property  has  been  pledged. 
— Thirty  years  since,  we  paid  off  all  our  foreign  debts.  Adopting  free 
trade  measures,  we  have  since  created  a  foreign  debt  that  requires  for 
payment  of  its  interest  alone,  more  than  tho  products  of  all  our  farms 
that  go  to  P^urope.  Then,  we  were  rich  and  strong.  Now,  we  appear 
as  beggars  for  loans  in  every  money  market  of  Europe,  and  arc  fast  be- 
coming the  very  paupers  of  the  world. 


THEIR   CAUSES   AND   EFFECTS. 


47 


That  our  system  tends  to  the  destruction  of  dnniestu;  coninioreo  in  the 
Atlantic  States,  is  beyond  a  (|uesti(in,  J  tow  it  afreets  the  vahie  ul'  land 
and  labor  throui;hout  those  Western  States,  in  wliose  tiiver  you  now 
appeal  to  your  Lei:,is!ature,  askinj^;  lor  a  continuance  of  the  system  by 
means  of  which  the  Mew  York  i'arnKT  is  made  to  pay  the  cost  of  trans- 
porting the  corn  and  wheat  of  his  Western  competitor,  wc  may  now 
inquire. 

Ten  years  since,  Conirress  created  in  Illinois  a  great  company  of  land- 
lords—  granting  many  millions  of  acres  of  land,  eoujilcd  with  the  oldi- 
gation  to  construct  a  road  from  north  to  south,  across  the  State.  I'wo 
years  later,  an  ex-Secretary  of  the  Treasury,  author  of  the  tariff  of  l^K!, 
was  found  in  London,  engaged  in  peddling  off  the  Company's  stock  and 
bonds.  While  there,  he  jmblished  a  book,  setting  forth  the  fact  that 
Illinois  abounded  in  rich  soils,  and  in  coal  and  ores,  and  proving  that 
the  land  alone  would  pay  for  making  a  road  that  was  to  cost,  aee(n'din£; 
to  my  recollection,  some  fifteen  or  twenty  millions  of  dollars  —  the  whole 
of  which  must,  therefore,  be  clear  profit  to  the  stockholders.  Eventually, 
the  bait  was  swallowed,  and  the  result  exhibits  itself  in  the  fact  that 
IMr.  Cobden  has  been  a  ruined  man  —  having  been  led  by  his  free  trade 
friends  to  invest  therein  the  whole  f;um  of  .S'>5<),0()0  paid  to  him  by 
the  Manchester  manufacturers,  as  com])ensation  for  his  successful  efforts 
at  bringing  about  a  repeal  of  the  British  corn  laws,  and  of  our  protective 
tariff  oi"  1842. 

Why  is  this  ?  Why  is  it,  that  the  proprietors  of  so  many  millions  of 
acres,  and  of  a  road  crossing  so  many  beds  of  coal  and  ores  of  various 
kinds,  are  ruined  men  ?  Because  the  road  runs  from  north  to  south, 
and  not  from  east  to  west,  and  cannot,  therefore,  be  made  a  part  of  any 
line  leading  through  New  York  to  Liverpool.  Because,  the  value  of 
the  land  depended  upon  the  development  of  domestic  conmierce  —  that 
commerce  which  "  Britain  has  so  much  cause  to  dread."  Had  the  tariff 
of  1842  continued  in  existence,  the  coal  of  Illinois  would  long  since  have 
been  brought  into  connection  with  the  lead,  iron,  and  copper  ores  of 
Missouri,  and  the  country  of  the  lakes,  and  wjiii  the  cotton  of  the  South ; 
and  then,  all  the  promises  of  IMr.  Walker,  and  all  the  hopes  of  Mr. 
Cobden,  would  have  been  fully  realized.  Had,  however,  that  tariff  been 
maintained,  the  people  of  Illinois  would  have  made  their  own  roads,  and 
the  country  would  have  been  spared  the  disgrace  of  having  ex-Cabinet 
ministers  engaged  in  the  effort  to  persuade  English  bankers  to  lend  the 
money  required  for  their  construction.  They  would  have  been  spared, 
too,  a  succession  of  financial  crises,  bringing  ruin  to  themselves,  while 
enabling  their  British  free  trade  friends  to  denounce  them,  in  conmioji 
with  all  their  countrymen,  as  little  better  than  thieves  and  vagabonds. 

The  less  our  domestic  commerce,  the  greater  is  our  dependence  upon 
Liverpool  and  Manchester,  and  the  less  our  power  to  construct  any  road 
that  does  not  lead  in  that  direction  —  the  general  rule  being,  that  north 
and  south  roads  can  never  be  made  to  pay.  Look  to  your  fiwn  State, 
crossed  by  two  railroads,  leading  through  your  city  to  Liverpool,  while 
your  people  are  being  heavily  taxed  for  an  enlargement  of  your  canals, 
which  hns  for  its  only  object  an  increase  of  competition  on  the  part  of 
Western  farmers;  that  increase,  too,  established  at  the  wry  moment 
when  your  railroad  owners  are  compelling  your  farmers  to  pay  all  the 


48 


FINANCIAL  GUISES  ; 


losses  tlicy  im'ur  in  currying  Western  pnrluee  at  less  than  the  more 
cost  of  tiaiisjMirtiitioii.  J'as.siiig  soiitli,  )ou  find  a  reniisylvanla  road, 
runni  g  east  and  west,  to  compete  with  joins,  Maryland  and  Virginia 
roads  to  compete  with  all,  and  South  Carolina  and  Georgiu  roads  in- 
tended to  do  the  same  J  hut  of  local  roads  you  find  almost  none  whatever. 
Why  is  this  ?  IJeeause  Liverpool  is  hecomiug  more  and  more  the  centre 
of  our  system,  with  New  York  for  its  jtlace  of  distribution.  Because  wo 
arc  fast  relapsing  into  a  state  of  colonization  even  mure  complete  than 
that  which  existed  before  the  llevolution. 

For  the  moment,  your  city  profits  by  this  British  free  trade  policy, 
the  prices  of  lots  rising  as  the  taxation  of  farming  lands  augments, 
but,  is  it  quite  certain  that  her  services  will  always  bo  re((uired,  as  dis- 
tributer of  the  produce  of  British  looms?  May  it  not  be,  and  that, 
too,  at  no  distant  period,  that  Manchester  and  Cincinnati  will  find  it 
better  to  dispense  with  services  that  recjuire  the  payment  of  such  ouor- 
mous  sums  as  arc  now  rc(iuired  for  the  maintenance  of  so  many  thousands 
of  expensive  families,  the  use  of  so  many  costly  warehouses,  and  the 

1)aynient  of  such  enormous  rates  of  interest?     The  Grand  Trunk  Road 
las  already,  as  we  arc  told  by  the  Daili/  Times, 

"  RrizeJ  upon  our  Western  carrying  trade,  and  linked  Chicago  and  Cincinnati 
to  Portland  and  Boston  by  the  way  of  Canada,  and  on  terms  which  almost  defy 
competition  from  the  trunk  lines  of  Maryland,  Pennsylvania,  and  New  York. 
They  are  delivering  flour  and  grain  in  New  England,  and  both  domestio  and 
forei;:;n  merchandize  in  Ohio  and  Illinois,  Aeaper  than  they  can  be  profitably 
transported  via  Philadelphia,  or  New  York,  or  Albany.  Not  content  with  this, 
they  have  entered  into  competition  with  our  coasting-trade  from  the  Gulf  to  the 
East,  and,  using  that  other  Anglo-American  enterprise  just  alluded  to,  the  Illinois 
Central,  are  delivering  cotton  from  Memphis  to  the  Now  England  factories 
chcipur  find  with  more  expedition  than  it  can  be  forwarded  by  the  Mississippi 
River  to  New  Orleans,  and  thence  by  sea  to  New  Y'ork  and  Boston.  Nor  have 
they  boon  unmindful  of  their  own  direct  steam  communication  with  England  from 
Quebec  and  Portland — the  last-named  point  being  converted  into  a  mart  of  British- 
American  commerce  by  reason  of  the  perpetual  lease  or  virtual  ownership  by  the 
Grand  Trunk  Company  of  the  Atlantic  and  St.  Lawrence  Railway  from  Portland 
to  the  Victoria  Bridge.  Th^m  are  now  using  the  Quebec  line  of  screw  8teamer.s, 
already  one  of  the  most  successful  between  England  and  this  continent,  for  de- 
livci'in?;  produce  from  Cincinnati  and  Chicago  at  Li\Grfoo\  m  twenty  days  !  —  to 
which  end  they  issue  their  own  responsible  bills  of  lading  in  the  West  through  to 
Liverpool.  A  sample  of  this  operation  may  be  seen  in  Wall  Street  almost  any  day 
attached  to  sterling  bills  of  exchange  made  against  breadstuffs  and  meat  and 
provisions  from  the  West  on  England.  And  it  is  by  no  means  certain  that  in 
another  year  the  cotton  of  Tennessee  and  North  Mississippi  will  not  be  made  to 
take  the  same  extraordinary  direction,  say  from  the  planting  States  to  Manchester 
through  Canada." 

Such  being  the  case  now,  at  the  end  of  fourteen  years  of  British  free 
trade,  what  will  it  be  ten  or  twenty  years  hence  ?  Arrangements  are 
already  on  foot  for  connecting  Southern  cities  with  Liverpool  by  means 
of  Portland,  while,  throughout  the  West,  the  managers  of  the  road 
'•  have  not,"  as  we  are  farther  told, 

"  Fai'cd  to  effect  the  needful  alliances  in  the  West,  to  make  the  connexions  at 
least  temporarily  complete.  The  Illinois  Central,  from  Cairo  to  Chicago,  is  their 
natural  ally  by  reason  of  its  English  proprietary,  and  they  bridge  the  peninsula 
of  Michigan  by  another  English  work,  the  Detroit  and  Milwaukee  Railway.  As 
this  last  connection  will  not  fully  answer  the  designs  of  the  company  on  '.a 


1 


TIIKIU   CAUSKS   AND    EFIKCTS. 


49 


winter  and  curly  spriiiR  triulo  of  tlio  Wost,  wliilc  tlio  luki'S  arc  doBed,  it  is  not 
iruroHHibJL'  tliat  nm:  ol'  tlio  oMit  Micliinaii  roals  nmy  lie  U'lisni,  liko  ♦ho  Atlantic 
niid  St,  Lnwrfiico,  or  iv  ciintrolliiiji  iiitci'i'st  imri'liacuil  in  it«i  .xhiiri'M  and  niorttfijjps. 
The  Micliif;iiii  Southern  hu.s  hcon  niuiiod  in  this  ct>nnci:tinn.  bi-caiiHO  of  its  infncnl 
linunciiil  einliarrawNnicnts,  which  hiivo  cheiiin'iifd  ulniii>t  to  a  nominal  viiluo  its 
stock  and  bonds,  and  liccaiisc,  too,  id'  its  tcraiinits  at  Toledo  us  well  as  Detroit; 
tlio  former  puiut  being  usHunliul  to  tho  Ciuuiuuati  coiuieutiouii  uf  the  tiraud 
Trunk." 

The  more  fr(M(uont  and  sovcro  our  finaiieial  crises,  tlio  more  iicrfetf, 
luuHt  become  tlio  control  of  IJritish  tnulora  over  all  our  roads,  and  tho 
greater  the  tendency  towards  diniinution  in  the  necessity  lor  profiting 
of  tho  services  of  Mew  York  stores  and  New  York  merchants.  So,  at 
least,  it  seems  to  mo. 

For  seven  years  past  we  have  talked  of  the  construction  of  a  road  to 
California,  but,  in  tlie  present  state  of  our  atl'airs,  becoming  poorer  and 
more  embarrassed  from  year  to  year,  it  is  nuite  impossible  that  we  should 
ever  enter  upon  such  a  work.  'J'ho  wealth  and  ])t)wer  of  ]?ritain,  on  the 
contrary,  become  greater  from  day  to  day  —  all  her  colonies,  ourselves 
ineliided,  being  compelled  to  add  to  the  value  of  her  land  and  labor, 
while  their  own  soils  become  more  and  more  impoverished,  and  their 
own  laborers  are  less  and  less  employ(!d.  Let  our  existing  commercial 
policy  be  maintained,  and  we  shall  see  the  Grand  Trunk  Koad  exlonded 
to  the  Pacific  —  Portland  and  tjuebec  becoming  the  agents  of  Liverpool 
and  Manchester,  and  taking  the  place  now  occupied  by  New  York. 

Looking  at  all  these  facts,  is  it  not  clear — 

That  all  our  tendencies  arc  now  in  the  direction  of  colonial  vassalage  ? 

That,  as  youi-  city  has  grown  at  the  expense  of  others,  because  of  its 
proximity  to  Liverpool,  so  other  places,  furnishing  means  of  communica- 
tion that  are  more  direct,  may  profit  thereby  at  its  expense  ? 

That  as  Liverpool  has  taken  the  place  of  New  York  iu  regard  to  ships, 
it  may  soon  do  so  in  regard  to  trade  ?     And  thereibre, 

That  the  real  and  permanent  interests  of  your  city  are  to  be  promoted 
by  an  union  of  all  our  people  for  the  re-establishment  of  that  industrial 
independence  which  grew  so  rapidly  under  the  protective  tariffs  of  1828 
and  1842  ?— 

Begging  you  to  be  assured  of  my  continued  determination  to  give  to 
the  answers  you  may  make  to  these  questions,  the  widest  circulation 
among  protectionist  readers,  I  remain,  my  dear  sir, 

Yours,  very  truly, 

IIemiy  C.  Carey. 
W.  C.  Bryant,  Esq. 

PiiiLADELPniA,  3farch  6,  1860. 


w 


IPINANCUL  GRIBES: 


LETTER    ELEVENTH. 


From  the  Evening  Post,  Tuesday,  Feb.  '2B, 

•'An  F.xampi,b  of  the  Kffect  of  PnoTKcrioN. — Amonf?  the  comtnndltlcH  wliidh 
have  hitherti)  not  been  pt-rniittiMl  to  bo  brouRht  into  Franco  from  Inn-inn  couiilrli"H 
it*  cutlery.  It  is  now  incliidod  in  tho  list  of  mcrchaudizo  to  which  tho  lutu  truiily 
with  Ofciit  Hritiiin  opens  tho  ports  of  Franco. 

"  Those  who  have  miido  a  comparison  of  French  cutlery  with  tho  cutlery  of  tho 
British  islands  must  have  been  at  first  surprised  at  the  diflerenco  in  thH  i|iiallty, 
Nothing  can  exceed  the  perfection  of  workmanship  in  tho  articles  turned  out  from 
the  workshops  of  SheHield.  Tho  symmetry  ond  perfect  adaptation  of  tiiu  form, 
tho  oxcellenco  of  tho  material,  tlio  freedom  from  flaws,  and  tho  mirror-liko  poliNh 
which  distinguish  them,  have  for  years  past  been  tho  admiration  of  tlm  worhl. 
French  cutlery,  placed  by  its  side,  has  a  ruder,  rougher  appearance,  an  unlliiJMht'J 
look,  as  if  the  proper  tools  were  wanting  to  the  artisan,  or  as  if  it  wuh  tliu  product 
of  a  race  among  whom  the  useful  arts  had  made  less  progress. 

"  This  is  not  owing  to  any  parsimony  of  nature,  either  in  supplying  tho  mato* 
rial  to  be  wrought  or  tho  faculties  of  tho  artisan  who  brings  it  to  a  UHufiil  Hliiipe. 
The  ores  of  the  French  mines  yield  metal  of  an  excellent  quality,  and  tlm  French 
race  is  one  of  the  most  ingenious  and  dexterous  in  tho  world.  In  all  manitfau- 
tures  requiring  tho  nicest  precision  and  the  greatest  delicacy  of  workmanslilp  tha 
French  may  bo  said  to  excel  the  rest  of  mankind.  Out  of  tho  most  unpromihlii({ 
and  apparently  intractable  materials  their  skilful  hands  fabricate  artlulen  of  unu 
or  ornament  of  the  most  pleasing  and  becoming  forms.  What,  then,  is  tho  rouNoii 
that  their  cutlery  is  so  much  inferior  to  that  of  Great  Britain? 

"  In  all  probability  the  reason  is  that  which  at  one  time  caused  tho  silk  tradu 
to  languish  in  Great  Britain,  which  at  one  time  made  tho  people  of  tho  muiiiu 
country  complain  that  their  glass  was  both  bad  in  quality  and  high  in  prico.  In 
both  these  instances  tho  competition  of  foreign  artisans  was  excluded;  tho  BrltlNh 
manufacturer  having  the  monopoly  of  the  market,  there  was  notliing  to  stiiiiiih(tO 
his  ingenuity;  he  produced  articles  of  inferior  quality,  his  vocation  did  not  tloii- 
rish,  and  both  he  and  tho  community  were  dissatisfied.  So  with  regard  to  Iho 
cutlery  of  France,  tho  difficulty  has  been  tho  prohibition  of  tho  foreign  arllulu, 
Let  the  foreign  and  the  French  commodity  be  looked  at  side  by  side  for  n  fnw 
years  in  the  shop-windows  of  Paris,  if  the  duty  to  "^hicli  cutlery  is  still  to  b« 
subject  will  permit  it,  and  wo  think  we  may  venture  to  pledge  ourselves  that  thA 
French  workmen  will  show  themselves  in  duo  time  no  way  behind  their  FnKllNh 
rivals.  We  may  expect  the  sanio  result  to  take  place  which  has  so  mueli  union* 
ished  and  puzzled  tho  friends  of  protection  in  Sardinia,  where  tho  removal  of 
prohibitions  and  protective  duties  has  caused  a  hundred  different  branoliu»  of 
manufacturing  industry  to  spring  to  suddeu  and  prosperous  activity," 


Dear  Sir:  —  Anxious  that  all  tho  protectionists  of  tho  Tfnion 
should,  as  fiir  as  possible,  have  it  within  their  power  to  study  bolli  MiditM 
of  this  question,  I  here,  as  you  see,  lay  before  my  readers  your  latiwt 
argument  against  protection,  thereby  affording  them  that  opportunity 
of  judging  ibr  themselves  which  you  so  systematically  deny  to  the  roadnrH 
of  the  Post.  Why  is  it  that  it  is  so  denied?  Is  it  that  tho  liritiMh 
eystem  can  be  maintained  in  no  other  manner  than  by  such  concoalmorit 


TIIKIR   TAl^KS   AND   ErFKCTS. 


51 


of  prrnt  riirts  iim  i>  Ik  n«  mi  clviirl)  oltviuuH?  Mliilc  i  iilarfiiiif;  upon  tlie 
Hoficiciicics  of  Krcmli  cutlery,  as  iVHultiiiH  ('nun  {.loticlioii,  was  if  iu'cch- 
iiiry  to  shut  out  fVum  view  (lie  iiii|Hirt,iiit  lart,  lliai  uiiilcr  a  iirntcctiNo 
nyHtciii  more  (((nnilrtc,  and  liniic  steadily  uialiilaiiieil,  than  any  olliir  in 
tho  world,  I'ranco  lian  jnado  fuch  cxlraordinaiy  prD^-rosM  in  all  tcxtilo 
nianui'actiires.  tliaf  slu^  imw  ixjini't.s  ul'tlu'ni  tn  tin!  extent  (d"alnin.st  Inin- 
tlreds  (.;■  niillinns  «il'  dollars  aiiiiually  —  mijiJiI^Imlc  tin  in  at  liunie  and 
abroad  so  clieaidy,  that  slic  finds  lu^rseU"  now  ready  t(!  sul-^titute  ]>nt- 
tnrtivo  duties  (nr  the  iiVnliiMtiims  \vlii(li  liavo  so  lun^  existed!:'  Wnuld 
it  not  be  far  more  fair  and  linne.-t  Uere  you  to  ^ivo  ^our  readers  all  tlio 
fucts,  instead  of  limiting  yoursell'  to  the  lew  that  can  be  mado  to  Hconi 
tofurni><h  evidence  oCtlio  truth  of  that  system  towliiehyou  are  >(»  much 
attached,  and  to  whieli  we  an;  indibted  lor  the  linantial  eri,>c."i  whoso 
ruinous  effects  ynu  bavc  so  well  described  ? 

Why  is  it  that  tin;  i'reneli  |ieci])!e,  while  so  successful  wilb  rejiard  to 
silks  ami  cottons,  are  so  delicient  in  respect  to  the  pruiluetidu  and  manu- 
fueturo  of  the  various  metals  ?  Q'hc  cause  of  this  is  not,  ns  you  tell  your 
readers,  to  be  found  in  "  the  parsimony  of  nature,"  ami  yi  t,  it  is  a  well- 
known  fact,  that  while  the  supply  of  coal  ami  iron  ore  is  very  limited, 
others  of  the  most  useful  uietals  are  not  to  bo  found  in  France.  Thin, 
howev(T,  is  not  all,  the  "parsimony  of  nature"  whi(di,  notwithstamlinj; 
your  denial  of  it,  so  certainly  exists,  bein^j;-  liere  aeiompanied  by  restric- 
tions on  domestic  C(unmercc  of  the  uiotit  injurious  kiiul,  an  account 
of  which,  from  a  work  of  the  bighcst  character,  will  bo  f"uud  in  the  fol- 
lowing paragraph : 

'•  Py  the  French  law,  all  minerals  of  evmi  hind  helovfi  tn  the  rrr>  •/,  ami  the  only 
advanliif/c  the  proprktur  of  the  toil  enjoys,  is,  to  have  the  refusal  <■!  the  mine  at  the 
rent  fi-ccil  ripim  it  hy  the  crown  surveyors.  There  is  pront  ditliculty  somotinics  in 
even  olitiiiniiig  tlio  leave  of  the  uiown  to  t-iiik  a  shaft  ujmii  tlie  jiroperty  of  the  in- 
(iividuiil  wlio  is  anxious  to  iiii(h'rtal;o  tlie  speculiUloii,  uinl  to  imy  the  rent  usuiiUy 

demniiileil,  n  certain  portion  of  the  gross  pnuluct.     The  Cointe  Alexamier  tie  15 

has  hcen  vainly  scekin;i;  this  pcrniisbiou  for  a  lead-iuiue  on  his  estate  in  Drittaiiy 
for  upwards  of  ten  years." 

Ilavincij  read  this,  j-on  cannot  but  be  satisfied  that  it  accounts  most 
fully  for  French  deficiencies  in  the  mining  and  metallurgic  arts.  That 
such  was  the  case,  you  knew  at  the  time  you  wrote  your  article,  or  you 
did  not  know  it.  If  you  did,  woidd  it  not  have  been  far  more  fair  and 
honest  to  have  given  all  the  facts?  If  you  did  not,  is  it  not  evident 
that  you  have  need  to  study  further,  before  uudertuking  to  lecture  upon 
questions  of  such  high  importance  ? 

Turning  now  from  French  cutlery  to  T^vltish  glass,  I  find  you  telling 
your  readers  that  the  deficiency  in  this  latter  had  been  "  in  all  proba- 
bility" due  to  the  fact,  that  "the  competition  of  i'oreign  artisans"  had 
been  so  entirely  excluded.  On  tne  contrary,  my  dear  :-ir.  it  was  duo  to 
restrictions  on  internal  commerce,  glass  having  been,  until  within  a  few 
years  past,  subjected  to  an  excise  duty,  yielding  an  annual  revenue  of 
more  than  8<5,O00,0OO.  To  secure  the  collection  of  tl:..t  revenue,  it  had 
been  found  necessary  to  subject  the  manufacturer  to  such  regulations 
in  reference  to  his  modes  of  operation  as  rendered  improvement  quito 
impossible.     From  the  moment  that  domestic  commerce  became  free, 


52 


FINANCIAL  CRISES  : 


0 


donipstic  cniiipctitinn  j<tow,  ^ringinj::  with  it  tlio  great  pTi.:i\ges  that  have 
since  occiirnxl.  That  s'lch  is  tlio  case,  is  known  to  all  the  world,  and  yet 
1  find  no  mention  of  these  important  facts  in  this  article  intended  for  tho 
readers  of  the  J^ost.  Would  they  not.  my  dear  sir,  be  better  instructed, 
were  you  to  permit  them  to  sec  and  read  both  sides  of  this  great  question  ? 

"What  has  recently  been  done  with  British  glass,  is  precisely  what  was 
sought  to  be  done  in  F;:incc  by  Colbert  and  Turgot,  both  of  whom  saw 
in  the  removal  of  restrictions  upon  internal  commerce  the  real  road  to 
an  extended  intercourse  with  other  nations  of  the  world.  With  us,  the 
great  obstacle  standing  in  the  way  of  domestic  commerce,  is  found  in 
those  large  British  capitals  which,  as  we  arc  now  officially  informed, 
constitute  "  the  great  instruments  of  •r'arfare  against  the  competing 
capitals  of  other  countries,  and  are  the  most  essential  instruments  now 
remaining  by  which  the  manufacturing  supremacy"  of  England  "can 
be  maintained;"  and  in  protecting  our  people  against  that  most  destruc- 
tive "  warfare,"  we  are  but  following  in  the  direction  indicated  by  the 
most  eminent  French  econoriists,  from  Colbert  to  Chevalier.  France 
has  protected  her  people,  and  therefore  is  it,  that  agricultural  products 
are  high  in  price,  while  finished  commodities  are  cheap,  and  that  the 
country  becomes  more  rich  and  independent  from  year  to  year.  We 
refuse  to  grant  protection,  and  therefore  do  wc  sink  deeper  in  colonial 
vassalage  from  day  to  day. 

Foreign  competition  in  the  domestic  market  is,  however,  as  wc  here 
are  told,  indispensable  to  improvement  in  the  modes  of  manufacture. 
TVis  being  really  so,  how  is  it,  my  dear  sir,  that  France  has  so  very 
mcch  improved  in  the  various  branches,  in  which  fo'.cign  competition 
has  been  so  cntirclj  jirohibi fed  :^  How  is  it,  that  Belgium  and  Germany 
have  so  far  superseded  England  in  regard  to  woollen  cloths  ?  How  is  it, 
that  American  newspapers  have  so  much  improved,  while  being  cheap- 
ened? Have  not  these  last  an  entire  monopoly  of  the  home  market? 
Would  it  be  possible  to  print  a  Tribune,  or  a  Pust,  in  J'iUgland,  for  New 
York  consumption  ?  Perfectly  protected,  as  you  yourself  are,  is  it  not 
time  that  you  should  open  your  eyes  to  the  fact  chat  it  is  to  the  stimula- 
tion of  domestic  competition  for  the  purchase  of  raw  materials,  and  for 
the  sale  of  finished  commodities,  we  must  look  for  any  and  every  increase 
in  the  wealth,  happiness,  and  freedom  of  our  people  ? 

The  more  perfect  the  possession  of  the  domestic  market,  the  greater 
is  the  power  to  supply  the  foreign  one  —  the  Trihiine  being  enabled  to 
supply  its  distant  subscribers  so  very  cheaply,  for  the  reason  that  it  and 
its  fellows  have  to  fear  no  competition  for  home  advertisements  from 
the  London  Times,  or  J^ust.  "This  principle,"  us  you  yourself  have 
most  truly  said, 

"Ts  pommnn  to  cvorv  b\isine=s.  Every  manufartnror  practiaes  it,  by  always 
allowinij;  the  piu'chaser  of  lurjio  quantities  of  his  miri)lus  Tiianiifacture  an  advan- 
tage over  the  douiestic  cousmuer,  for  tlic  simple  rea,-:i)ii  that  tlie  domestic  con- 
sumer must  support  tho  iiianul'ucturer,  and  as  the  ([uautity  of  ^^oods  consumed  at 
home  is  very  much  larger  than  tiiat  sent  abroad,  it  is  tho  habit  of  the  manufac- 
turer to  Rotid  liis  surplus  abroad,  and  Fell  at  any  price,  so  as  to  relievo  tho  market 
of  a  surplus  which  might  depress  prices  at  home,  and  compel  him  to  wor'-  at  little 
or  no  protit." 


THEIR  CAUSES   AND  EFFECTS. 


63 


Admitting  now  that  it  wore  possible  for  the  London  Times  to  supply, 
on  every  Evening,  a  paper  precisely  similar  to  yours — forcing  abroad  the 
surplus,  and  selling  "  at  any  price,  so  as  to  relieve  the  domestic  market," 
would  you  not  be  among  the  first  to  demand  protection  against  the 
system?  "W^ould  you  not  assure  your  readers  of  the  entire  impossibility 
of  maintaining  competition  against  a  journal,  all  of  whose  expenses  of 
composition  and  editorship  were  paid  by  the  home  market  —  leaving  its 
proprietors  to  look  abroad  for  little  more  than  the  mere  cost  of  paper 
and  of  prcsswork  ?  Would  you  not  demonstrate  to  them  the  absolute  ne- 
cessity of  protecting  tJicniseh'cs  against  a  "warfare"  that  must  inevitably 
result  in  the  creation  of  a  "  little  oligarchy  "  of  monopolists  who,  when 
domestic  competition  had  been  finally  broken  down,  would  compel  them 
to  pay  ten  cents  for  a  journal  neither  larger  nor  better  than  they  now 
obtain  for  two  ?     Assuredly,  you  would. 

Addressing  such  arguments  to  your  British  free  trade  friends,  they 
would,  however,  refer  you  to  the  columns  of  the  Post,  begging  you  to 
study  the  assurance  that  had  there  been  given,  that — 

•'Whenever  the  course  of  finnncial  fluctuation  shall  have  broken  tlie  hold  of 
monopolists  and  speculators  upon  the  mines  of  iron  and<coal,  which  the  Almighty 
made  for  the  common  use  of  man,  and  whenever  there  shall  bo  men  of  skill  and 
enterprise  to  spare  to  go  into  the  business  of  iron-making  for  a  living,  and  not 
on  s]  eculation,  who  shall  set  their  wits  at  it  to  find  out  the  best  wnjs  and  the 
cheapest  processes,  it  must  be  that  such  an  abundance  both  of  ore  and  fuel  can 
be  nmdo  to  yield  plenty  of  iron,  in  spite  of  the  competition  of  European  iron- 
masters who  have  to  bring  their  products  three  thousand  miles  to  find  a 
market." 

To  all  this  you  would,  of  course,  reply,  that  "  financial  fluctuations  " 
created  monopolies,  and  never  "broke  their  hold;"  that  men  of  "skill 
and  enterprise"  were  not  generally  rich  enough  to  compete  with  such 
rivals  as  the  London  Times;  that  domestic  competition  had  already 
given  us  "cheaper  ways  and  cheaper  processes"  than  any  other  country 
of  the  world ;  that  the  freight  of  a  sheet  of  paper  was  as  nothing  com- 
pared with  the  cost  of  editorship  and  composition ;  that  all  these  latter 
costs  were,  in  the  case  of  the  British  journals,  paid  by  the  domestic 
market;  that  "the  domestic  consumers  supported  the  British  manufac- 
turer;" that  the  quantity  of  journals  consumed  at  home  was  so  very 
great  that  their  producers  could  afibrd  to  sell  abniad  "  at  any  price  " — 
thereby  "  relieving  the  market  of  a  surplus  which  might  depress  prices 
at  home,  and  compel  them  to  work  at  little  or  no  profit;"  and  that,  I'or  all 
these  reasons,  it  was  absolutely  necessary  to  grant  you  such  protection  as 
would  give  you  the  same  security  in  the  domestic  market  as  was  then 
enjoyed  by  your  foreign  rivals  ? 

Would  not  all  this  be  equally  true  if  said  to-da  v  of  our  producers  of 
cloth  and  iron,  coal  and  lead?  Does  the  policy  you  advocate  tend  to 
place  them  in  a  position  successfully  to  contend  with  those  British  man- 
ufacturers who  "  voluntarily  incur  immense  losses,  in  bad  times,  in  order 
to  destroy  foreign  competition,  and  to  gain  and  keep  possession  of  foreign 
markets"?  Can  they  resl.st  the  action  of  the  owners  of  those  '"groat 
accumulations  of  capital"  which  have  been  made  at  our  cost,  and  are 
now  being  used  to  "  enable  a  few  of  the  most  wealthy  capilalistti  to  o\er- 


64 


FINANCIAL  crises: 


whelm  all  foreign  competition  in  times  of  great  depression  "--  therebj^ 
largely  adding  to  their  already  enormous  fortunes, "  before  foreign  capital 
can  again  accumulate  to  such  extent  as  to  be  able  to  establish  a  compe- 
tition "in  prices  with  any  chances  of  success"?  Can  it  be  to  the  interest 
of  any  country  to  leave  its  miners  and  manufacturers  exposed  to  a  "  war- 
fare" such  as  is  here  officially  declared  ?  Do  not  they  stand  as  much  in 
need  of  protection,  for  the  sake  of  the  consumers,  as  you  would  do  in 
the  case  supposed  ?  Does  not  your  own  experience  prove  that  the  more 
perfect  the  security  of  the  manufacturer  in  the  domestic  market,  the 
greater  is  the  tendency  to  that  increase  of  domestic  competition  which 
tends  to  increase  the  prices  of  raw  materials,  while  lessening  the  cost 
of  cloth  and  iron  ?  Do  not  men,  everywhere,  become  more  free,  as  that 
competition  grows,  and  as  employments  become  more  diversified  ?  Is 
not,  then,  the  question  we  are  discussing,  one  of  the  freedom  and  hap- 
piness of  your  fellow-men  ?  If  so,  is  it  worthy  of  you  to  offer  to  your 
readers  such  arguments  as  are  contained  in  the  article  above  reprinted  ? 
Holding  myself,  as  always  heretofore,  ready  to  give  to  my  readers 
your  replies  to  the  questions  I  have  put,  I  remain,  my  dear  sir, 

Yours,  very  truly, 

Henry  C.  Carey. 


W.  C.  Bbtant,  Esq. 


PaiLADEiPHiA,  March  IZth,  1860. 


rilElB  CAUSES   AND   EFFECTS. 


55 


LETTER    TWELFTH. 

Dear  Sir  :  —  Thirty  years  since,  South  Carolina,  prompted  by  a 
determination  to  resist  the  execution  of  laws  that  were  in  full  accordance 
with  both  the  letter  and  the  spirit  of  the  Constitution,  first  moved  a  dis- 
solution of  the  Union.  Failing  to  find  a  second,  she  stood  alone.  Since 
then,  all  has  greatly  changed.  Now,  each  successive  day  brings  with  it 
from  the  South  not  only  threats  but  measures  of  disunion,  each  in  its 
turn  finding  more  persons  in  the  centre  and  the  North  anxious  for  the 
maintenance  of  the  Union,  yet  disposed  towards  acquiescence  in  the 
decision  of  their  southern  brethren,  whatever  that  may  prove  to  be. 
This  is  a  great  change  to  have  been  cfiected  in  so  brief  a  period,  and  sad 
as  it  is  great.  To  what  may  it  be  attributed,  and  how  may  the  remedy 
be  applied? 

Before  answering  this  latter  question,  let  us  inquire  into  the  causes 
of  the  disease  —  for  that  purpose  looking  for  a  moment  into  the  records 
of  our  past.  The  men  who  made  the  Revolution  did  so,  because  they 
were  tired  of  a  system  the  essence  of  which  was  found  in  Lord  Chatham's 
declaration,  that  the  colonists  should  not  be  permitted  to  make  for  them- 
selves "  even  so  much  as  a  single  hobnail."  They  were  sensible  of  the 
exhaustive  character  of  a  policy  that  compelled  them  to  make  all  their 
exchanges  in  a  single  market — thereby  enriching  their  foreign  masters, 
while  ruining  themselves.  Against  thi&  system  they  needed  protection, 
and  therefore  did  they  make  the  Revolution  —  seeking  political  inde- 
pendence as  a  ^eans  of  obtaining  industrial  and  commercial  independ- 
ence. To  render  that  protection  really  effective,  they  formed  a  more 
perfect  union,  whose  first  Congress  gave  us,  as  its  first  law,  an  act  for 
the  protection  of  manufactures.  Washington  and  his  secretaries,  Ham- 
ilton and  Jefferson,  approved  this  course  of  action,  and  in  so  doing  were 
followed  by  all  of  Washington's  successors,  down  to  General  Jackson. 
For  half  a  century,  from  1783  to  1833,  such  was  the  general  tendency 
of  our  commercial  policy,  and  therefore  was  it  that,  notwithstanding  the 
plunder  of  our  merchants  under  British  Orders  in  Council  and  French 
Decrees,  and  notwithstanding  interferences  with  commerce  by  embargo 
and  non-intercourse  laws,  there  occurred  in  that  long  period,  in  time  of 
peace,  no  single  financial  revulsion,  involving  suspension  by  our  banks, 
or  stoppage  of  i)aymont  by  the  government.  In  all  that  period  there 
was,  consequently,  a  general  tendency  toward  harmony  between  the  North 
and  the  South,  in  reference  to  the  vexed  question  of  slavery — both  Vir- 
ginia and  Maryland  having,  in  1832,  shown  themselves  almost  prepared 
for  abolition.  Had  the  then  existing  commercial  policy  been  maintained, 
the  years  that  since  have  passed  would  have  been  marked  by  daily 
growth  of  harmony,  and  of  confidence  in  the  utility  and  permanence  of 
our  Union.  • 

Such,  unhappily,  was  not  to  be  the  case.     Even  at  that  moment  South 
Carolina  was  preparing  to  assume  that  entire  control  of  our  commercial 


56 


FINANCIAL  crises: 


policy,  which,  with  the  exception  of  a  single  Presidential  term,  she  has 
since  maintained — thereby  forcing  the  Union  back  to  that  colonial  system, 
emancipation  from  which  had  been  the  primary  object  of  the  men  who 
made  the  Ecvolution.  With  that  exception  her  reign  has  now  endured 
for  more  than  five  and  twenty  years,  a  period  marked  by  constantly- 
Tcenrring  financial  convulsions,  attended  by  suspensions  of  our  banks, 
bankruptcies  of  individuals  and  of  the  government,  and  growing  discord 
among  the  States. 

What,  you  will  probably  ask,  is  the  connection  between  financial  re- 
vulsion and  sectional  discord  ?  Go  with  me,  my  dear  sir,  for  a  moment, 
into  the  poor  dwelling  of  one  of  our  unemployed  workmen,  and  I  will 
show  you.  The  day  is  cold,  and  so  is  his  stove.  His  Avife  and  children 
are  poorly  clothed.  His  bed  has  been  pawned  for  money  with  which  to 
obtain  food  for  his  starving  family.  He  himself  has  for  months  been 
idle,  the  shop  in  which  ho  had  been  used  to  work  having  been  closed, 
and  its  owner  ruined.  Ask  him  why  is  this,  and  he  will  tell  you  to  look 
to  our  auction-stores  and  our  shops,  gorged  with  the  products  of  foreign 
labor,  while  our  own  laborers  perish  in  the  absence  of  employment  that 
will  give  them  food.  Ask  him  what  is  the  remedy  for  this,  and,  if  he 
is  old  enougii  to  remember  the  admirable  efiects  of  the  tariff  of  1842, 
he  will  tell  you  that  there  can  be  none,  so  long  as  southern  commercial 
policy  shall  continue  to  carry  poverty,  destitution,  and  death,  into  the 
homes  of  those  who  must  sell  their  labor  if  they  would  live.  That  man 
has,  perhaps,  already  conceived  some  idea  of  the  existence  of  an  "  irre- 
pressible conflict"  between  free  and  slave  labor.  A  year  hence,  he  may 
be  driven  by  poverty  into  abolitionism. 

The  picture  here  presented  is  no  fancy  sketch.  It  is  drawn  from  life. 
This  man  is  the  type  of  hundreds  of  thousands,  I  might  say  millions, 
of  persons  of  various  conditions  of  life,  who  have  been  ruined  in  the 
repeated  financial  crises  of  the  five-and-twenty  years  of  British  free  trade 
and  South  Carolinian  domination.  Follow  those  men  on  their  weary 
way  to  the  West,  embittered  as  they  are  by  the  knowledge  that  it  is  to 
southern  policy  it  is  due  that  they  are  compelled  to  separate  themselves 
from  homes  and  friends,  and  perhaps  from  wives  and  children.  See  them, 
on  their  arrival  there,  paying  treble  and  quadruple  prices  for  the  land 
they  need,  to  the  greedy  speculator  who  finds  his  richest  harvest  in  free 
trade  times.  Mark  them,  next,  contracting  for  the  payment  of  four  and 
even  five  per  cent  per  month,  for  the  little  money  they  need,  knowing, 
as  they  do,  that  we  arc  exporting  almost  millions  of  gold  per  week,  to 
pay  to  foreigners  for  services  that  they  would  gladly  have  performed. 
Watch  them  as  they  give  for  little  more  than  a  single  yard  of  cotton 
cloth,  a  buf<licl  of  corn,  that  under  a  different  policy  would  give  them 
almost  a  dozen  yards.  Trace  them  onward,  until  you  find  their  little 
properties  passing  into  the  hands  of  the  sheriff,  they  themselves  being 
forcer!  to  seek  new  homes  in  lands  that  are  even  yet  more  distant. 
Reflect,  I  pray  you,  upon  these  facts,  and  you  will  find  in  them,  my  dear 
sir,  the  reasons  why  the  soil  of  Kansas  has  been  stained  by  the  blood  of 
men  who,  under  other  legislation,  would  have  been  found  acting  together 
for  the  promotion  of  tht;  general  good. 

Mr.  Calhoun  sowed  the  seeds  of  sectionalism,  abolitionism,  and  dis- 
anion,  on  the  day  on  which  he  planted  his  free  trade  tree.    Well  watered 


THEIR  CAUSES   AND   EFFECTS. 


57 


and  onrcfiilly  f(!M(l(!(l  liy  your.'^clf  and  others,  all  have  thriven,  nnrl  all  are 
now  yieliliiig  IVnit  —  iti  exhaustion  of  the  soil  of  the  older  Stales,  and 
conwequeKt  tliirnt  for  tlio  acquisition  of  distant  territory;  in  Kansas 
"inunlerH  luid  Harper's  Ferry  riots;  in  civil  and  foreign  wars.  It  is 
tho  Hunu!  fruit  that  has  been  produced  in  Ireland,  India,  and  all  otlier 
countries  tliiit  are  sulijeeted  to  the  British  system.  Desiring  that  tho 
fruit  nmy  wither,  you  must  lay  the  axe  to  the  root  of  the  tree.  Tliat 
done,  th(!  nuxinus  jdants  that  have  flourished  in  its  shade  will  quickly 
decay  and  diMappcar. 

Wo  ur<(  (old,  however,  that  the  interests  of  the  South  jire  to  he  pro- 
rtiotod  l»y  tli»!  inaintetiaiice  of  the  system  under  which  Ireland  and  India 
liavo  been  ruined,  and  which  it  is  the  fashion  of  the  day  to  term  free 
trade.  Was  that  the  opinion  of  "Washington,  Jefferson,  Madison,  or 
fJackHonl*  ]n  it,  even  now,  the  opinion  of  those  Southern  men  whose 
views  in  regard  to  the  slavery  question  are  most  in  accordance  with  your 
ownl'  Arcs  not  Kentucky  and  Tennessee,  Virginia  and  North  Caro- 
lina, Alalminii  and  Missouri,  rich  in  fuel  and  iron  ore,  and  all  the  other 
niateriulM  reijuired  for  the  production  of  a  varied  industry?  Did  not 
the  donicHtic  eonsumption  of  cotton  increase  thrice  more  rapidly  than 
tho  jxipulutiori,  under  the  tariff  of  1842?  Had  it  continued  to  increase 
an  it  tlieti  was  doing,  would  it  not  now  absorb  a  million  and  a  half  of 
bales  —  diluinisliing  by  many  hundreds  of  thousands  the  quantity  for 
which  wo  need  a.  foreign  market?  Under  such  circumstances  would  not 
our  planters  obtain  more  fur  two  and  a  half  million  of  bales  than  they 
now  do  for  three  and  a  half  millions?  Rely  upon  it,  my  dear  sir,  there 
is  no  discord  in  the  real  and  permanent  interests  of  the  various  sections 
of  tho  Cnioii.  There,  all  is  perfect  harmony,  and  what  we  now  most 
need  Ik  the  recognition,  by  men  like  you,  and  iDy  our  southern  brethren, 
(jf  tho  oxiHt(!nce  of  that  great  and  important  fact.  In  that  direction,  and 
that  al(»no,  may  b(!  Ibund  the  remedy  for  our  great  disease. 

Looking  for  it  there,  tho  effect  will  soon  exhibit  itself  in  this  develop- 
ment of  the  vast  tuitural  resources  of  every  section  of  the  country — iu 
the  utili'/utiuti  of  the  great  water-powers  of  both  South  and  North  —  and 
in  tho  inercuHO  of  that  internal  commerce  to  which,  alone,  wo  can  look 
for  extrication  frnm  tho  dilficuUics  in  which  we  are  now  involved.  Let 
our  policy  bo  such  as  to  produce  development  of  that  comuicrcc,  and 
villagOH  will  be(!orne  tied  to  villages,  cities  to  cities,  States  to  States,  and 
zones  to  Zones,  by  silken  threads  scarcely  visible  to  the  eye,  yet  strong 
enough  to  bid  deliiince  to  every  effort  that  may  1)0  made  to  break  them. 
Dritish  policy  sought  to  prevent  the  creation  of  tnich  threads  —  British 
politicians  having  seen  that  by  crossing  and  recrossing  each  other,  and 
tving  to;.;"th(;r  the  Puritan  of  the  north,  the  Quaker,  the  German,  and 
the  iriwhinan  of  the  centre,  and  the  Episcopalian  of  the  south,  they 
would  givo  utiity  and  strength  to  the  great  whole  that  would  be  thus 
produet'(l.  Hticli,  too,  is  the  tendency  of  our  present  policy,  our  whole 
energi((H  having  been,  and  being  now,  given  to  the  creation  of  nearly 
parallel  lines  ol'  eoinniunication  —  roads  and  canals  passing  from  west  to 
east  through  New  Vork  and  Pennsylvania,  Maryland,  Virginia,  and  Caro- 
lina—  always  at  war  with  each  otlier,  and  never  touching  until  they 
reach  the  conjuietvial  capital  of  the  British  islands.  In  that  direction 
lie  jianpciri.Mn,  scclionalism,  weakness,  and   final  ruin   of  our  .«y.stom 


58 


FlNANCIAIi  CRISES; 


Desiring  that  the  Union  mav  bo  maintained  we  must  seek  again  the  road 
so  phiinly  indicated  to  us  by  Wasiiington,  Jefferson,  Madison,  Monroe, 
and  Jackson,  the  greatest  men  the  South  has  yet  produced. 

In  common  with  Franklin  and  Adams,  Hancock  and  Hamilton,  those 
men  clearly  saw  that  it  was  to  the  industrial  element  we  were  to  look 
for  that  cement  by  which  our  people  ^'\d  our  States  were  to  be  held 
together.  Forgetting  all  the  lessons  they  had  taught,  we  have  now  so 
long  been  following  in  the  direction  indicated  by  our  British  free  trade 
friends  —  by  those  who  now  see,  as  was  seen  before  the  Revolution,  in 
the  dispersion  of  our  people  the  means  of  maintaining  colonial  vassalage 
— that  already  arc  they  congratulating  themselves  upon  the  approaching 
dissolution  of  the  Union,  and  the  entire  re-establishment  of  British  influ- 
ence over  this  northern  portion  f"  the  continent.  For  proof  of  this, 
permit  me  to  refer  you  to  the  following  extracts  from  the  Morning  Post, 
now  the  recognised  organ  of  the  Palmcrstonian  government : 

*'■  If  ihe  Northern  States  should  ttparate  from  the  Southern  on  the  question  of  slavery 
—  ono  which  now  eo  fiercely  agitates  the  public  mind  in  America  —  that  portion 
of  the  Grand  Trunk  Railway  which  traverses  Maine,  might  at  any  day  be  closed 
ngninst  England,  unless,  indeed,  the  people  of  that  State,  with  an  eye  to  commercial 
profit,  should  offer  to  annex  themselves  to  Canada.  On  military,  as  well  as  commer- 
cial grounds,  it  is  obviously  necessary  that  British  North  America  should  possess 
on  the  Atlantic  a  port  open  at  nil  times  of  the  year — a  port  which,  whilst  the  ter- 
minus of  that  railway  communicatiui  which  is  destined  to  do  so  much  for  the 
development  and  consolidation  of  (ho  wealth  and  prosperity  of  British  North 
America,  will  make  England  equally  in  peace  and  war  independent  of  the  United 
States.  We  trust  that  the  question  of  confederation  will  be  speedily  forced  upon 
the  attention  of  her  Majesty's  Ministers.     The  present  time' is  the  most  propitious 

for  its  discussion If  slavery  is  to  be  the  Nemesis  of  Republican 

America — if  separation  is  to  take  place — the  confederated  States  of  British  North 
America,  then  a  strong  and  compact  nation,  would  virtually  hold  the  balance  of 
I  ])owcr  on  the  continent,  and  lead  to  the  restoration  of  that  influence  lohich,  more  than 
eighty  years  ago,  England  was  supposed  to  have  lost.  This  object,  with  the  uncer- 
tain future  of  Republican  institutions  in  the  United  States  before  us,  is  a  subject 
worthy  of  the  early  and  earnest  consideration  of  the  Parliament  and  people  of  the 
mother  country." 

Shall  these  anticipations  be  realised  ?  That  they  must  be  so,  unless 
our  commercial  policy  shall  be  changed,  is  as  certain  as  that  the  light 
of  day  will  follow  the  darkness  of  the  night.  Look  whoro  we  may,  dis- 
cord, decay,  and  slavery,  march  hand  in  hand  with  the  British  free  trade 
system  —  harmony  and  freedom,  wealth  and  strength,  on  the  contrary, 
growing  in  all  those  countries  by  which  that  system  is  resisted.  Such 
having  been,  and  being  now,  the  case,  are  you  not,  my  dear  sir,  in  your 
steady  advocacy  of  Carolinian  policy  among  ourselves,  doing  all  that  lies 
in  your  power  toward  undoing  the  work  that  was  done  by  the  men  of  '76  ? 

Repeating  once  again  my  offer  to  place  your  answers  to  this  and  other 
questions  within  the  reach  of  a  million  and  a  half  of  protectionist  readers, 
I  remain,  Yours,  very  respectfully, 

Henry  C.  Carey. 
W.  C.  Betant,  Esq. 

PHiLADBLtHiA,  March  21,  1860. 


